In the past two years, dozens of crypto-focused venture capital firms have flocked to India in an effort to use the country’s sizable developer population as a vital web3 powerhouse. But what does Changpeng “CZ” Zhao, arguably the most significant and powerful person in the cryptocurrency sector, believe of India’s potential? As of right now, not much.
“To be honest, I don’t think India is a very crypto-friendly environment,” said Zhao at the TechCrunch Crypto conference Thursday.
Zhao’s pessimistic assessment of the Indian market is not unique. I’ve spoken to dozens of investors and company founders who have privately expressed similar worries, but Zhao’s remarks is noteworthy since no other person of Zhao’s position has publicly expressed a comparable opinion.
Zhao attributed the market’s lack of viability on the nation’s high tax climate.
“If you are going to tax 1% on each transaction, there is not going to be that many transactions,” he said.
Binance, the world’s largest cryptocurrency exchange by volume, is undoubtedly open to users in India.
“A user could trade 50 times a day and they will lose like 70% of their money. There is not going to be any volume for an order book type of exchange. So we don’t see a viable business in India today. We just have to wait. We are in conversation with a number of industry associations and influential people and trying to put some logic there,”
He continued by stating that levying a high tax on each transaction results in a general decrease in tax accumulation.
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