The Indian crypto industry got a new crypto-INR futures exchange named 'Pi42' on Wednesday, February 7. Zebpay CEO Avinash Shekhar and WazirX founder Nischal Shetty have founded this exchange to give Indians the convenience to engage with crypto without facing one percent TDS on every transaction. The launch of the platform comes two years after the Indian Finance Ministry imposed a tax on crypto activities. Despite community outcry demanding amendments to these tax laws, the government has taken no action, leading to stagnation in the growth of the sector.
With crypto futures exchanges, investors can predict the future price of crypto assets and trade at those predicted future prices. So unlike spot trading transactions, where holders trade at the current prices of tokens and pay one percent TDS on each transaction, here holders can hold the assets for a longer period of time – until the asset reaches its expected price point. Can wait. This automatically reduces the loss related to TDS.
“Crypto derivatives trading volumes are significantly higher than spot volumes worldwide. Shetty, as co-founder of Pi42, said in an official announcement that futures trading brings several benefits to investors such as better liquidity, leverage opportunities, higher profit potential and tax efficiency.
In recent months, India has strengthened its surveillance of the Web3 sector. The country is gradually implementing rules to regulate the otherwise volatile sector, with the goal of stabilizing the industry and curbing the margins for the exploitation of these virtual assets. One such mandatory rule for crypto firms is to register with the Financial Intelligence Unit (FIU) of India.
Pi42, as revealed by its founders, has already been registered with the FIU – meaning Indians can start trying it out.
“India has one of the largest crypto enthusiast communities in the world and yet we have extremely limited opportunities to explore innovations in crypto such as futures trading. “Our aim is to revitalize the industry for modern investors and help redefine financial freedom by providing them tax-efficient and regulatory compliant trading options,” Shekhar said.
The Pi42 app is being released first for Android users in India and will soon be available for iOS users as well. In the coming months, Shetty and Shekhar aim to expand this futures trading exchange to other international locations as well. The Indian crypto community has suffered a decline in growth over the past two years. Industry leaders have blamed the tax system for pushing investors out of the box. Ahead of the announcement of the interim Budget 2024 earlier this month, '#ReduceCryptoTax' was trending across all major social networking platforms.
Despite these requests from the industry, Finance Minister Nirmala Sitharaman did not even mention the crypto industry in her speech. Industry leaders are now waiting for changes in the final budget to be presented after India's upcoming elections.