Critics calls government's ban on offsetting Crypto losses ‘Regressive’

The Blockchain and Crypto Assets Council (BACC)  launched an attack on the Union government over the state's ambiguous crypto policies. BACC reacted angrily to a recent clarification stating that a loss in one crypto asset could not be offset against another.

BACC office bearers called the provision'regressive' in a statement, adding that it would discourage retail investors from participating in the country's crypto boom. It also stated that prohibiting crypto losses from being offset could have a negative impact on tax collection in the country.

Ashish Singhal, co-chair of the BACC and CEO of CoinSwitch Kuber, stated, "We fear that the lack of provision to offset losses will drive users away from KYC-compliant exchanges and platforms and into the peer-to-peer grey market, defeating the purpose of the new tax." "The Budget recognised virtual digital assets (VDAs) as an emerging asset class," Singhal continued. As a result, the natural course of action would have been to gradually bring the regulations in line with other asset classes. Instead, we have taken a step back with this clarification in Parliament. If a regressive provision like this had been applicable in equities, retail investors would have been discouraged from participating."