Crypto firms across the country are halting their services including Mobiwik, a popular payment service provider which was in business with almost all the exchanges in the country. Wazirx, the crypto exchange which was acquired by Binance in 2019, suffered a 72% drop in trading volume while Coindcx 52 and Zebpay suffered 52% and 59% losses respectively. 

Suril Desai, a senior crypto lawyer speaking on the recent developments in the Indian crypto scene stated that it is still unclear as to whether the decline in trading volume means the trading has moved somewhere else. “The only trading volume we get comes from exchanges. The off-chain trades could be happening for which there is no record,” Desai stated.

Sathvik Vishwanath, co-founder, and CEO of Unocoin, another Indian exchange, has also expressed his displeasure at the latest tax saying that it is affecting the market. Speaking on Twitter, Vishwanath stated,  “People earning less than 1,000,000 (Indian rupees) per year are affected by 30% fixed income tax on crypto. 1% TDS is affecting the market makers and liquidity providers. Both are needed for a better crypto ecosystem in India.” 

The latest crypto market news across India also led to Coinbase suspending its option to purchase cryptocurrencies through the Unified Payments Interface (UPI), on its app in India. This new development comes just four days after integrating India’s most adopted instrument for digital payments to support its trading services in the Asian country.

Coinbase’s partnership with Unified Payments Interface initially came with some controversies as the National Payments Corporation of India (NCPI), which created UPI, in response to Coinbase announcing their involvement with UPI, stated that no crypto exchange was using the UPI system.

Coinbase recently invested $150 million through its investment arm in two crypto exchanges as part of its plan to spread its reach across India. Coinbase at that time revealed that investing in the Indian crypto space was a long-term experiment, a major factor that has brought so many criticisms to its latest decision. 

CEO of KuCoin, Johnny Lyu, after the latest development revealed that the new tax is going to affect crypto adoption in the country as beginners, out of fear of laws like this are less willing to invest in crypto in the short term.

"KuCoin hasn’t seen any outflow though, according to internal data. This can be explained by the higher degree of crypto nativeness among our users,"  Lyu stated. "The new law will affect short-term market mood and behavior, but it will be difficult to block the adoption of crypto in the long run."

According to multiple reports, the crypto market news in India could get even more interesting as another damaging tax will go into effect on July 1, which will subject crypto transactions to a 1% tax deducted at source (TDS).