In its year-end report for 2022, WazirX said: “After five years of consistent efforts to provide easy crypto access to users, we witnessed market sentiments reaching an alarming low. This was in contrast to the positive sentiment we saw in the last few years, especially in 2021, when crypto saw its best bull run ever”.
The crypto industry has seen a massive downturn this year, with the collapse of several large firms such as FTX, Terraform Labs (creator of TerraUSD), Celsius Network and Voyager Digital.
In India, the crypto industry faced regulatory uncertainty. WazirX noted in its report that the country was “still on the brink of an uncertain future when it comes to crypto, with no regulations to protect users in case of massive losses in the portfolio or bad actors who run fraudulent businesses to trap vulnerable investors”.
The Union Budget for 2022-23 introduced a 30% tax on profits from virtual digital assets and a 1% tax deducted at source on all crypto transactions.
WazirX said following the imposition of taxes on virtual digital assets, investors started pulling out because their gains “would not be for them to keep, resulting in an unfavorable situation”. “This factor also significantly affected our trading volumes and other market players’ volumes. Starting April 2022, when the tax came into effect, we saw a drastic decrease in the number of trades per day as compared to last year or even the previous month,” the report noted.
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On user behaviour, WazirX said women traded 20% of the top tokens on the platform, on average. The top tokens traded on WazirX were BTC, USDT, SHIB, WRX, ETH, TRX, DOGE and MATIC.
Further, women above the age of 41 transacted more in VDA than men in the same age group, while women aged 26-40 contributed 46% of the total trading volume by all women users on the platform.
WazirX listed Elon Musk’s acquisition of Twitter as one of the triggers for trading volume jumps during the year, “News of Musk offering to buy Twitter started floating in mid-April. The trading volume of Dogecoin on WazirX went up by 1,300% compared to the previous week,” it said.
“The volume dipped when the deal apparently fell through. However, towards the end of October, when the Twitter acquisition by Elon was near completion, the trading volumes went up significantly by 3,000% despite low trading volumes in the previous few weeks,” the report added.