Bitcoin mania: Tax windfall as India holding of crypto crosses $120 billion
With Indians holding a massive $120 billion in Bitcoin investments now, social media platforms are abuzz over its potential windfall to the exchequer. To recall, India started taxing cryptocurrencies, classified as virtual digital assets (VDAs), at 30 per cent since the Union Budget 2022-23. Even with a 30 per cent capital gains tax, 1 per cent TDS on transactions, and limited institutional participation, India still now ranks second in the global Bitcoin ownership.
Fund manager Alok Jain, founder of Weekend Investing, pulled a string on social media platform X, as he believes billions of dollars would be generated in tax from Bitcoins, a potential windfall for the government of India.
this is quite surprising data point
India crypto hodlers sitting on $120B wealth !!
FM would be seeking $40B here now https://t.co/H0VnLddiZ3
India ranks second in holding the Bitcoins (BTC) in the world, which is mostly held by retail investors with small holdings, suggesting an estimate of global Bitcoin ownership. Numerically, India holds 1 million BTC, which are valued around $115-120 billion. This is 5.1 per cent holding of all Bitcoin in circulation across the world.
India is only lagging the United States (US), which holds 7.8 million Bitcoins, worth a value of $936 billion, accounting for a 40 per cent for token in circulation. Europe owns 0.9 million BTC worth $109 billion, while the China Government owns 0.194 million, or 1 per cent Bitcoin worth $23.3 billion.
“Very motivating data to look at on a Monday morning. Even with a 30% capital gains tax, 1% TDS on transactions, and limited institutional participation, India still ranks #2 in global Bitcoin ownership,” said Sumit Gupta, Co-founder of CoinDCX in a post on X. “We just need friendlier policies, taxes, and clearer frameworks and India has a great chance to be #1 in global bitcoin ownership.”
In the Union Budget 2022-23, Finance Minister Nirmala Sitharaman had introduced a 30% tax on income from cryptocurrencies, classified as virtual digital assets (VDAs), and cannot offset cryptocurrency losses against other gains or carry them forward. Investors are also required to pay 1% TDS on crypto transactions. However, taxation is not applicable on the unrealised profit.
Bitcoin is the world’s oldest and largest cryptocurrency, with a total market capitalization of $2.27 trillion. It has a total domination of 61.2 per cent in the crypto market, which has a total valuation of $3.72 trillion. Bitcoin is currently valued around $1,14,000, which is down more than 7.3 per cent down from its all time high around $123,091.61.