We do not want regulations to curb innovation: WazirX CEO

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Finance Minister Nirmala Sitharaman used her budget speech to acknowledge a “phenomenal increase” in virtual digital asset transactions and unveil a plan to tax any income from the transfer of such assets at 30 per cent. 

The move, which many interpreted as India’s first real step towards adopting cryptocurrencies, has brought hope to various stakeholders from traders to exchanges. In a series, DH brings you voices from the world of cryptocurrencies.

First in the series is an interview with Nischal Shetty, the head of cryptocurrency exchange Binance’s Indian arm WazirX. In a wide-ranging discussion with DH’s Veena Mani, the founder and chief executive officer of WazirX discussed the impact of the budget speech, expectations from the crypto bill and the future of crypto in Asia’s third-largest economy. Edited excerpts.

How do you feel now that the government has decided to tax virtual digital assets?

Finally, we are being recognised. In a way, taxing cryptocurrency makes it mainstream and legal. We are now hoping to be seen that way by everyone. Now, we are looking forward to the crypto bill that will give us more clarity on where we stand.

What are your expectations from the crypto bill?

We do not want regulations to curb innovation. That is why many countries have not regulated cryptocurrency. Our bill does not talk about NFT. What will happen to that if the bill in this format is approved by the parliament? Crypto is like the internet. It keeps changing. So, the government should not regulate the whole sector and instead think of regulating specific cryptocurrencies.

Also read: Decision on banning cryptos or not to come later: FM Nirmala Sitharaman

What do you think about the plan to tax income from the transfer of virtual digital assets at 30 per cent rate?

The fact that there is taxation and definition is a positive. Large section of people trading in cryptocurrency fall in the 20 per cent tax bracket. It is a nightmare for the common man. Additionally, it might be a nightmare for the government to process TDS and refunds.

Have you seen any tangible difference in how people perceive cryptocurrencies since the budget announcement?

Well, we have seen a 30 per cent to 40 per cent increase in sign-ups since then. I cannot give (the) exact numbers but yes, this increase is a positive signal.

Are banks warming up to crypto transactions? 

We are working with only wallets as of now. But, hopefully, we will get banks also on board soon. We are talking to banks so that our users can transact through them.

What does the budget announcement mean to you as a crypto exchange?

Crypto now has a definition. It is now an asset and not a currency. To that effect, it is clear in everyone’s mind that we are not competing with the digital rupee.

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