Michaela
Summary: How could India’s 18% crypto tax impact Shiba Inu (SHIB) and its ecosystem?
India’s new 18% GST, on top of existing crypto taxes, may reduce profit margins and dampen trading activity for SHIB holders in the region. However, it also signals greater regulatory recognition of the crypto space. This could benefit established ecosystems like Shiba Inu by positioning them as more credible and compliant in a maturing market.
Dubai-based centralized cryptocurrency exchange Bybit Fintech Limited has begun applying an 18% Goods and Services Tax (GST) on its crypto services for Indian users. The move comes as part of the company’s efforts to comply with India’s tightening regulatory framework for digital assets.
According to an official statement from the exchange, Bybit not only introduced higher transaction costs but also withdrew select services from the Indian market to comply with the country’s tax and regulatory requirements. These changes are set to take effect today, July 7.
The exchange further clarified that the 18% crypto tax will be applied to a range of services, including spot and margin trading, derivatives, fiat transactions, and crypto withdrawals. The tax will be automatically deducted from the assets received by users.
GST will also apply to conversion activities within Unified Trading Accounts, such as auto-repayments and liquidations, the exchange confirmed. In addition, service fees on interest payouts from native staking through On-Chain Earn will be subject to crypto tax deductions. However, APR Boost rewards will remain exempt from the tax.
Indian users making crypto withdrawals, including those reclaiming mistakenly deposited assets, will also face crypto tax charges on associated withdrawal fees, the exchange confirmed. Bybit further noted that GST will apply to all transactions involving users and merchants, with tax calculated based on the spread. This includes activities carried out through its crypto payment platform, Bybit Pay, as well as fiat buy/sell services and over-the-counter (OTC) trading.
Related: Dubai Purges Privacy, Stablecoins In Strict New Crypto Laws
Bybit noted that the newly implemented 18% GST will be levied in addition to India’s existing crypto tax structure, which includes a 30% tax on profits and a 1% Tax Deducted at Source (TDS).
Effective July 9, several services will no longer be available to Indian users on Bybit’s platform. These include legacy crypto loans, the Bybit Card, and a range of trading bots such as Spot Grid, DCA, and Futures Combo. These changes are also part of the exchange’s broader efforts to align with India’s evolving regulatory environment.
By July 17, Indian users holding Bybit cards will no longer be able to initiate new transactions, the exchange announced. Additionally, any outstanding crypto loans will be automatically repaid by the platform.
Why India’s Crypto Tax Could Be a Turning Point for SHIB
India’s new crypto tax could have significant implications for Shiba Inu (SHIB) holders, particularly those based in or interacting with Indian markets. For SHIB investors, this means reduced margins, more cautious trading activity, and possibly a shift in how Indian users engage with meme tokens and other altcoins.
That shift could be especially meaningful given SHIB’s massive traction in the region. A December 2024 report highlighted SHIB as the most-traded crypto in India, and by February and March 2025, social media chatter pointed to it being the #1 most held cryptocurrency in the country. This level of exposure means policy changes in India will likely ripple across SHIB’s global market dynamics.
Related: Excluding Bitcoin Now Poses Greater Portfolio Risk Than Volatility: VanEck
However, while this may seem like a setback on the surface, it also presents a long-term opportunity for Shiba Inu’s ecosystem. India’s decision to tax crypto services more rigorously signals growing regulatory acceptance and formalization of the industry.
In the big picture, tighter regulation may filter out low-utility projects while paving the way for established ecosystems like Shiba Inu to grow more sustainably—particularly those already building with compliance, utility, and longevity in mind.
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MICHAELA
Michaela is a news writer focused on cryptocurrency and blockchain topics. She prioritizes rigorous research and accuracy to uncover interesting angles and ensure engaging reporting. A lifelong book lover, she applies her passion for reading to deeply explore the constantly evolving crypto world.
