Interestingly, Indians were obsessed with buying gold because they believed it was an asset; some own 25,000 tonnes of gold. Within a month, Indian crypto investments have risen from nearly $923 million to $6.6 billion, according to Chainalysis.
The gold investors were totally captivated by the crypto mantra that Bitcoin (BTC) is equal to gold resulting in conversion from gold to crypto assets. These investments are happening despite the fact that the country has banned cryptocurrency.
A 32-year old entrepreneur, Rishi Sood has shared her experience gained from crypto investments. She has invested over a million rupees ($13,400) in Bitcoin (BTC), Dogecoin (DOGE), and Ether (ETH) since December 2021, some of which she borrowed from her father.
Moreover, she appears to be lucky with her timing as she cashed out some of her position when Bitcoin reached $50,000 in February. Then she re-invested after the recent drop, allowing her to fund the international expansion of her education startup, Study Mate India. Sood stated:
“I’d rather invest in cryptocurrency than gold. Crypto is more transparent than gold or property, and the returns are more rapid.”
Most Investors Tend To Invest in Crypto
The 18-35 year age group is driving the increase in the number of crypto investors in India. According to the most recent World Gold Council data, Indian adults under the age of 34 have a lower appetite for gold than older investors. Sandeep Goenka, who co-founded ZebPay and spent several years representing the industry in regulatory discussions with the government, stated:
“Because the process is so simple, they find it far easier to invest in cryptocurrency than gold. You go online, you can buy cryptocurrency, and unlike gold, you don’t have to verify it.”
The current regulatory volatility is the primary issue in the Indian market to adopt crypto widely. Besides, the Supreme Court overturned a 2018 rule that prohibited banking institutions from trading in cryptocurrency last year.
Significantly, India isn’t the only country where regulators are working tirelessly to limit and crackdown on the cryptocurrency market. The UK Financial regulators banned Binance Market Ltd recently from engaging in any regulated business in the United Kingdom.
Consequently, the Japanese FSA issued a regulatory warning on Binance for the act of money laundering. Similarly, Binance has ceased operations in Ontario, and the Monetary Authority of Singapore has directed regulators to “Follow up” on Binance.
Despite the warnings and issues, many investors are confident and strong in crypto investments. Because of the regulators’ hostility, many big investors are not opening up about their investments.
However, growth is evident, particularly in trading. According to CoinGecko, daily trading on the top four crypto exchanges increased to $102M from $10.6M about a year ago. According to Chainalysis, the country lags far behind China’s $161 billion market. Today, growing adoption is another major indicator of the government’s willingness to take a small risk in the consumer finance industry, which has been plagued by incidents of regulatory failure.
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