“We need to actively work towards creating an ecosystem where investors can trade without fear and entrepreneurs are allowed to innovate without worrying about the future of their ventures. We need to create localised venture funds dedicated to funding crypto startups and seasoned crypto entrepreneurs should leverage their experience to raise a new breed of crypto entrepreneurs in domains such as crypto security, Web3, and Defi.”
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Amidst the bear phase, crypto exchanges in India have been facing trouble from both investors and law enforcement agencies. In an interview with ETMarkets.com, BuyUcoin‘s CEO Shivam Thukral says that with the new tax regime, every penny in crypto space is under tax lens and regulations for the crypto space are the need of the hour. Edited excerpts:
The crypto market has been struggling lately. Do you think that woes will last longer than expected amid expectations of rate hikes and fear of economic slowdown?
During the dream bull run of 2021, crypto assets delivered stellar returns which were never seen in modern human history. Bitcoin touched $69,000 last year which made headlines all over the world. We need to understand that every new asset class goes through cycles of correction phases and the trends are dependent on multiple factors surrounding the economy. The crypto market is undergoing a correction phase and it will result in a stable and mature investment ecosystem for crypto enthusiasts around the globe.
Indian crypto volumes have been hit hard since the beginning of the new financial year. Do you think that investors have lost interest in the digital asset class or they are waiting for another bull run to join the party?
The second half of 2021 encouraged a lot of investors sitting on the fence to take a plunge in crypto assets. We witnessed a massive jump in the number of first-time investors which swelled the crypto holdings among Indians. Crypto investors are loyal, long-term holders who have faith in the potential of crypto assets for creating long-term wealth and beating inflation.
The decline in exchange volumes can be attributed to the new regulatory regime in crypto and also people anticipating the next bullish period.
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« Back to recommendation storiesI don’t want to see these stories becauseThey are not relevant to meThey disrupt the reading flowOthersSUBMIT Homegrown crypto companies, exchanges and trading platforms have faced some strict regulatory and agency action. What is your take on it? Do you think that Indian exchanges have the mechanisms for ensuring fair trade practices?
Indian exchanges have a big responsibility to keep the money of crypto investors safe and secure. Most of the crypto exchanges follow strict KYC and AML procedures not only to comply with the regulations but to prevent misuse of crypto assets. After the new crypto tax regime was implemented, all the crypto transactions came under a tax lens, and authorities can monitor and track every penny moved within the crypto ecosystem.
Most of the founders running crypto companies in India are Indian residents and easily accessible to Indian authorities and agencies gives a certain comfort level to the government for safe crypto operation by India-registered entities.
IAMAI dismantled BACC recently. Indian exchanges do not have anybody for guidance or regulation. Even the self-regulatory mechanisms are not enough for all problems. Don’t you think in such cases, it becomes difficult for other stakeholders to completely trust the industry at large?
BACC was a group of like-minded crypto entrepreneurs sharing a common platform to raise the legitimate concerns/issues faced by the crypto industry in India. The members of BACC are still a strong group of passionate individuals working towards making crypto and blockchain mainstream in India.
The industry has moved from self-regulation to government-monitored regulation after the recent tax laws were implemented. Just like the stock market, crypto exchanges should also be monitored by a Sebi-like body and some parts of regulation can be under RBI.
The formal tax structure for crypto has given much-needed confidence to the crypto investors in India. I strongly believe that the industry will create a much more evolved association that will work as a common voice of the industry on the regulatory front.
BuyUCoin has been a south-centric exchange as the majority of the user base comes from southern states. Have the trends changed now? What are your plans to increase the user base, particularly in the northern region?
BuyUcoin is India’s second longest-running cryptocurrency exchange with a user base spread across the length and breadth of the country. Our user base is spread across major Indian states with a majority of investors from Karnataka, Maharashtra, Uttar Pradesh, Delhi, and Haryana. However, we have observed a massive surge in users from the Southern part of India due to investors buying the dip during the bearish phase.
What are the factors that can revive the crypto sentiments in India? Do you think regulations and a comprehensive framework would be enough to revive the crypto market? Share your view.
The crypto investors in India have realised the benefits of long-term crypto investing and we have observed that first-time investors are also holding their crypto assets for a longer period to protect their wealth from inflation. Support from the formal banking system, easy tax filing, and business-friendly policies are some of the factors which can truly boost the confidence of India’s strong and growing crypto community.
We need to actively work towards creating an ecosystem where investors can trade without fear and entrepreneurs are allowed to innovate without worrying about the future of their ventures. We need to create localised venture funds dedicated to funding crypto startups and seasoned crypto entrepreneurs should leverage their experience to raise a new breed of crypto entrepreneurs in domains such as crypto security, Web3, and Defi.
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