Trading volume on India’s top crypto exchange WazirX fell to $1 billion in 2023 as the platform faced intensifying regulatory pressure in its home market alongside a broader slump in digital asset prices – and stocks – globally.
The total volume of cryptocurrencies traded on WazirX’s platform this year is down 90% compared to 2022, when volumes reached $10 billion, and 97% lower than 2021’s $43 billion.
WazirX, which has been at loggerheads with Binance over ownership of the Indian firm, put a positive spin on the latest figures, touting a $1 billion trading account in a public statement on Tuesday. However, the exchange declined to adjust the number, bypassing the much higher levels seen when crypto fever was at its peak in 2021 or even 2022, before the sharp sell-off prevailed.
The 97% drop in trading volume comes as WazirX faces increasing regulatory pressure from Indian authorities that have left the country’s once booming crypto sector struggling for survival. India began taxing virtual currencies last year, imposing a 30% tax on profits and a 1% discount on every crypto transaction. Indian lawmakers have consistently praised Prime Minister Narendra Modi’s leadership for protecting Indian citizens from the scams plaguing the crypto market and the dramatic fall in asset prices.
New Delhi-based think tank Esya reported earlier this year that the local tax rule forced many Indian traders to use foreign platforms, including Binance and Coinbase. Coinbase later stopped onboarding new customers in India.
India’s intensifying regulatory crackdown on cryptocurrencies has spooked local investors who were once eager to back the country’s crypto startups. The adverse climate, previously cited by Binance as a reason for its own reticence about Indian expansion, has made venture capital firms dramatically wary of exposure to the troubled sector, people familiar with the matter said.
Many of the top VCs that focused on India and had enthusiastically backed crypto companies just last year have since shifted their focus decisively to other industries, according to people familiar with the matter.
