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Indian cryptocurrency traders are facing increased costs following the implementation of an 18% Goods and Services Tax (GST) by crypto exchange Bybit. The move comes amid India’s tightening regulatory framework for digital assets, signaling significant changes in the country’s crypto ecosystem.
Effective July 7, 2025, Bybit announced it would apply the mandated 18% GST on various service and trading fees for Indian residents. This tax applies to spot and margin trading, derivatives, fiat transactions, and crypto withdrawals. Fees and GST deductions are taken directly from users’ transaction proceeds. For example, a sale of 1 BTC valued at 100,000 USDT will result in a net receipt of 99,882 USDT after combined fees and GST deductions totaling 118 USDT.
Additionally, Unified Trading Accounts will incur GST on conversion activities such as auto repayments and liquidations. Native staking services via Bybit’s On-Chain Earn platform will also face GST deductions on service fees for interest payouts, although APR Boost rewards remain exempt.
Withdrawal fees, including those related to recovering incorrectly deposited assets, are subject to GST. Other transaction types, including transfers via Bybit Pay, fiat buy/sell options, and over-the-counter (OTC) trading, will see GST applied to all transfers between users and merchants, calculated based on the transaction spread.
The GST is imposed in addition to the existing 30% capital gains tax on crypto profits and a 1% Tax Deducted at Source (TDS), resulting in a substantial overall tax burden on Indian crypto users.
In parallel with the GST implementation, Bybit announced it will discontinue several services in India starting July 9. These include legacy crypto loans, the Bybit card, and several trading bots such as Spot Grid, DCA, and Futures Combo. Cardholders will be blocked from new transactions by July 17, and any outstanding loans will be automatically repaid. Bybit attributes these measures to its compliance strategy in response to India’s evolving regulatory environment.
While the company’s compliance ensures legal adherence, some industry observers and crypto advocates express concern that increased taxation and service limitations could stifle India’s emerging crypto market and hinder broader adoption.
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