Zerodha CEO Highlights Crypto F&O Boom in India Amid Tax and Leverage Advantages

Nithin Kamath, founder of Indian brokerage Zerodha, expressed astonishment at the explosive growth of cryptocurrency futures and options trading in the country. The sector thrives in a regulatory gray area, buoyed by favorable tax treatment and extreme leverage unavailable in traditional markets.

Derivatives volumes now triple spot trading activity on domestic platforms, according to industry sources. Unlike spot transactions, crypto F&O escapes India's 1% TDS levy and the punitive 30% capital gains tax on VIRTUAL digital assets. This regulatory arbitrage creates fertile ground for speculative trading.

The leverage factor proves particularly seductive. While equity derivatives cap exposure, crypto platforms offer substantially higher multipliers - a dangerous temptation for retail traders chasing outsized returns in an unregulated environment.