Indian Crypto Buzz is Getting Louder; Investments at ₹75kcr

Over 105 million people, 7.90% of India’s total population, currently own cryptocurrency: Report

Sachin Dave & Saloni Shukla

Mumbai:

The crypto party just got bigger this week, as Indian crypto exchanges recorded their biggest investment levels ever, not only in terms of the number of investors, but also in the sums invested.

According to crypto research and intelligence business CREBACO, Indian crypto investments have increased to over $10 billion from $923 million in April 2020, as crypto markets touched all-time highs (based on IP traffic and crypto quantities of Indian users). “Over 105 million people, 7.90% of India’s total population, currently own cryptocurrency,” CREBACO said. The key reason for the increase, according to industry observers, was greater awareness.

“People are now more aware of how the centralised financial system works. And when you know that it is flawed, you have no choice but to move towards decentralisation,” said Siddharth Sogani, founder, CREBACO.

“For retail investors, there is not much to worry about. For HNIs (high net-worth investors) and institutional investors, there is a risk. Also, for those who are investing over $250,000 above the Liberalised Remittance Scheme (LRS) limit there are risks involved.”

Most cryptocurrency exchanges experienced an increase in the number of investors as well as in the value of their assets. This comes at a time when multiple exchanges have released new products, including Systematic Investment Plans, in order to attract more investors.

For BuyUcoin, users jumped by 600% in the last one year. The valuation of assets held by these investors jumped by 1,000% to touch $250 million in the same period.

“Positive bull cycles, global regulatory support, big influencers like Elon Musk, VC funding, investment awareness and education are the main reasons for the spurt,” said Shivam Thakral, CEO, BuyUcoin.

“India needs to regulate crypto in order to maintain investor protection,” he cautioned. Cryptocurrency investments in India are unregulated and there is no consensus on how assets should be classified or taxed. That hasn’t stopped Indians from investing in cryptocurrency though. Following the onset of the Covid-19 pandemic in India, which kept people indoors due to the nationwide lockdowns, the number of investors and money invested in crypto assets appear to have exploded.

“The trading volume on Indian exchanges was noted to be $1 billion every day. However, the traffic on international exchanges through Indian IPs indicates a massive surge by Indian traders which may cross over $5 billion, which are totally unaccounted,” CREBACO said. Industry trackers say Indian investors have also evolved when it comes to investing in cryptocurrency in the last one year.

Unlike previously, Indian investors are not only investing in Bitcoin, but also in other crypto assets such as Ethereum, Solana and Ripple. Indian investors were also quick to jump on to meme coin Shiba Inu’s bandwagon when prices jumped 300% last week.

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