By Mahiya Fayaz Sheikh
Bangalore: For as long as we can remember, investments have always been restricted to assets such as deposits at the bank, buying gold jewellery, shares and stocks, and also real estate. But now, there’s a new player in the game and he is putting forth a competition that is worthwhile. Cryptocurrency is the latest form of Investment and it has been dispensing good profits to it’s investors, guaranteeing to derange the dominant and non competitive tech eco system, and now most of the population seems to desire their part in this game. As of now, globally the total crypto market value seems to be exceeding $2.21 trillion, with the trade amount being more than $100 billion globally everyday. Before one dives deep into this world of digital currency, it is always recommended to understand this avenue of investment better. Cryptocurrency does not depend on banks for the verification of transactions. It is solely a digitized system of payment. This system enables anyone and everyone to send and receive payments. These payments exist only as digital entries in an online database that understands, presents and accounts specific transactions unlike the physical money we carry around with us in the real world. Stored and contained in digital wallets, once cryptocurrency is transferred, these digital transactions are then recorded in a public ledger. “Bitcoin” was the first form of cryptocurrency. Founded in the year 2009 Bitcoin remains one of the best forms of digital currency known till this day. Some other forms of Cryptocurrency are Ethereum (ETH), Solana (SOL), XRP, Tether (USDC), Binance Coin (BNB), etc.
Cryptocurrency was first introduced to India in the year 2009 in the form of a Bitcoin. The very first mercantile digital transaction occurred in the year 2010 which was then followed by the first cryptocurrency exchange in the year 2013. During the past few years, India has congregated a notable and consequential amount of interest in Cryptocurrency providing it with a significant following. According to Ku Coin’s ‘Into The Cryptoverse Indian Report’ survey released on 23rd August, 2022, in the present day India holds about 115 million crypto investors, mainly aged between 18 years to 60 years, 40% of the investors being below the age of 30. Over the past few years India has significantly been active within the cryptocurrency market. In fact in accordance with analyses brought through by research, this country holds the highest amount of crypto owners. Hence with the growing rate of these crypto owners, more than 60% of states in India are emerging as Crypto Tech adopters, making India the second highest country in terms of adoption rate, along with over 15 million retail investors. The technological ecosystem in India is buzzing with thirsty and talented individuals who are willing to quench their thirst by taking a dive in this vast ocean of digital investment. Research proves that if this ecosystem continues to enhance and expand itself from all possible aspects as it is doing so currently, then soon India will be capable of establishing itself at a top tier position globally.
The Indian government is proceeding with and regulating cryptocurrency in a circumspect yet focused and determined manner. In the year 2017, Reserve Bank Of India (RBI) issued an official warning, stating that crypto currencies/virtual money is not legal in India, but there was no action taken or no ban was put on cryptocurrency. Then in the year 2019 the Reserve Bank Of India (RBI) issued another statement that stated any practise related to Cryptocurrency such as trading, transferring, holding or even the usage of cryptocurrencies is subject to punishment. The punishment namely being and simply varying from just a fine or jail imprisonment for up to 10 years. During the period of 2019 RBI had also mentioned that it may introduce the now ‘Digital Rupee’ as a legal option in the near future. Soon in the year 2020, all bans were lifted off Crypto currency by the Supreme Court Of India, that were imposed by RBI. In the year 2022 is when things took a turn after the Government of India took a stance by notifying the country that any cryptocurrency transaction will be subjected to 30% tax deduction in accordance with the Union Budget of 2022-23. Also, taxes will be imposed on the receiver solely when it comes to gifts that are in the form of cryptocurrency. The Reserve Bank Of India again in July 2022, recommended a ban on Cryptocurrency, the reason being India’s fiscal and pecuniary wellbeing.
Over the past year, due to the government’s partial opposition over cryptocurrency, over 33% of survey respondents expressed their concern for a number of reasons, which is completely valid. Along with that, the security factor seems to be on the minds of Indian Crypto investors as well, with 26% of the survey respondents being anxious about crypto hacks and 23% of them being concerned about losing assets in security breach situations. During the time period of October 2021 to June 2022, about 2042 Indian adults between the ages of 18 and 60 were polled about the state of crypto in the country. 1541 of these respondents claimed to be crypto investors who possess or have traded digital currencies in the duration of the last 6 months. 41% of poll respondents stated they were unassertive about which form of crypto asset to invest in, while 37% cited a lack of knowledge regarding portfolio risk management and stated this as one of the reasons regarding security and regulatory concerns that dissuade novices from being a part of this humongous Crypto family. Furthermore 21% of survey respondents indicated they knew little to nothing about cryptocurrency and how it functioned. Statistically shown that 39% of Indian Crypto investors are between the ages of 18 and 30, investing in Crypto for the future was a major topic of debate in the research.
Cryptocurrency may or may not have a future in India in the upcoming years, this depends on many factors, the major one being the rules and regulations of the government, but one thing known to us for sure is that Cryptocurrency can, and will boost the digital economy of this country. This digital world is capable of doing wonders if used in the right way. It is always better to keep an open mind and have a hunger for new things when it comes to growing our country from all aspects.