Crypto Tax India: Here’s What the New 18% GST Means for Traders

Published by

Vignesh S G and Qadir AK

July 7, 2025

India has never been a crypto-friendly country. While other Asian nations welcomed digital assets, New Delhi chose a restrictive path, and now, things are getting even tougher.

India Crypto Tax Burden Just Got Heavier

Crypto influencer Keyur Rohit (176K+ followers on X) revealed that starting July 7, 2025, Bybit will apply 18% Goods and Services Tax (GST) to all crypto-related services for Indian users.

This makes India one of the highest-taxing nations in the crypto space globally.

What Will Be Taxed Under the New Rule?

According to Rohit, the 18% GST will apply to nearly all services on Bybit:

Spot and futures trading
Copy and bot trading
Staking rewards
Withdrawals
Card payments
Token swaps
Yield earnings
Deposits via card or bank

Notably, crypto loans and the Bybit Card will be discontinued for Indian users.

A Triple Tax Trap?

Here’s how crypto is currently taxed in India:

30% tax on crypto profits
1% TDS on every sell transaction
Now, 18% GST on all services (on Bybit)

This combination could push Indian crypto users away from regulated platforms.

Also Read :
WazirX Users Take Legal Action Over Frozen Crypto Funds in Singapore
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Will Indian Users Shift to DeFi?

Rohit warns this move could discourage trading and encourage a shift to DeFi or peer-to-peer platforms, where:

Privacy is higher
Users avoid TDS on CEXs
Tax compliance becomes more complex—but possibly less immediate

The Bigger Picture

While avoiding tax isn’t advisable, India’s crypto ecosystem urgently needs a fair and innovation-friendly tax framework. Over-taxing could drive users underground and slow the sector’s growth. As of July 7, India’s crypto tax burden becomes heavier than ever. While DeFi might offer temporary relief, long-term change can only come from balanced regulation that supports innovation without stifling users.

FAQs

Which crypto services on Bybit are now subject to 18% GST for Indian users?

The 18% GST on Bybit for Indian users applies to a wide range of services including spot and futures trading fees, copy and bot trading, staking rewards, withdrawals, card payments, token swaps, yield earnings, and deposits via card or bank. Additionally, crypto loans and the Bybit Card are being discontinued for Indian users.

How does India’s “triple tax trap” affect crypto users?

India’s “triple tax trap” combines a 30% tax on crypto profits, a 1% TDS on every sell transaction, and now an 18% GST on exchange services. This heavy cumulative taxation may deter trading on regulated platforms, potentially pushing Indian crypto users towards decentralized finance (DeFi) or peer-to-peer (P2P) platforms for greater privacy and to avoid some taxes.

What is the overall impact of India’s crypto taxation on its digital asset ecosystem?

India’s stringent and increasing crypto taxation, including the 30% profit tax, 1% TDS, and now 18% GST on services, is driving users away from regulated platforms. This approach risks stifling innovation and growth in the crypto sector, potentially pushing activities underground rather than fostering a fair and innovation-friendly tax framework.

Vignesh S G and Qadir AK

Vignesh is a young journalist with a decade of experience. A proud alumnus of IIJNM, Bengaluru, he spent six years as a Sub-Editor for a leading business magazine, published from Kerala. His interest in futuristic technologies took him to a US-based software company specialising in Web3, Blockchain and AI. This stint inspired him to view the future of journalism through the lens of next generation technologies. Now, he covers the crypto scene for Coinpedia, uncovering a vibrant new world where technology and journalism converge.

Published by

Vignesh S G and Qadir AK

Tags: Crypto Regulations