With more than a billion citizens, India is the world’s second most populous country and has the world's largest IT population. However, the cryptocurrency market in India is still in its primary stages which is now moving forward expeditiously.
India is growing at a tremendous speed and are now looking to adopt bitcoin, blockchain and cryptocurrency on the whole.
As data shows, Indians are now more open to new investments and global trends than before. Around 15 to 20 million Indians are now buying and selling digital coins as compared to US's 23 million.
Bitcoin, The New Gold for Indians
Households in India currently hold 25,000 tonnes of gold, valued at $1.5 trillion. To put this in context, the top 12 country’s total gold reserve equals to 24,700 tonnes. But, people in India have now started shifting towards digital collectibles and currencies.
Culturally, and also given the low returns in the recent past, I do not think modern Indians are investing much in gold. Things have changed over the last 15-20 years.
-Dipen Sheth, Head-Institutional Research
The statistics say, Crypto wave has already begun in India. From $200 million, investments in cryptocurrency grew to $40 billion in the past year. The four biggest crypto exchanges in India saw daily trading jump to $102 million from $10.6 million. This surge in investments comes after the Supreme Court's verdict where it quashed the RBI order to ban crypto transactions.
Impact of India's User Surge on Bitcoin
By the end of 2023, 50 million+ Indians would be buying and selling digital coins. Therefore, Increasing the current crypto investments from $40 billion to $140 billion in the country.
The gold market in India is in trillions of dollars and if even a small fraction of that investment makes its way into crypto then $100K for Bitcoin would become the new normal.
Currently, the price of Bitcoin is hovering around $35K from the past few weeks, which shows the market is bearish. If everything goes well in India, we could see the next bear market in 60s due to the growth in Indian market.
Give it about a year or two and BTC will reach its all time high at $100K and India will play a major role in that.
India's Regulatory Uncertainty
The country ranks 18th in Bitcoin investment gains at $241 million even after billion population. This may be a result of the Indian government’s historical unfriendliness to cryptocurrency.
In April 2018, the RBI issued a circular instructing banks to not allow banking services for crypto transactions.
In March 2020, The Supreme Court in its judgment overturned the RBI’s 2018 circular
June 2021, Banks in India still hesitate to allow crypto transactions.
The domestic investor community has often expressed its desire for having a proper regulation and framework for full-fledged working of cryptocurrency in India.
There's still uncertainty about the future of crypto. India does not have a regulatory framework to govern cryptocurrencies as of now. The Indian government has assured crypto traders that there won't be a complete ban.
" There won't be a total ban on the use of cryptocurrencies in the country "
-Nirmala Sitaraman, Finance Minister-India
The government is planning to regulate digital currencies in India and are also looking for ways to impose tax on crypto derived gains. Only problem they're currently facing is International exchanges.
The domestic investor community has often expressed its desire for having a proper regulation and framework for full-fledged working of cryptocurrency in India.
Whatsoever Indian government does, we know one thing for sure that is " BTC to the Moon "
