India is rising as a bitcoin hot spot after their Supreme Court overturned a central bank diktat, opening the way for the second most populous country on earth to join the crypto party.
India and China now both account for 33% of bitcoin peer to peer (p2p) trading volumes according to Arcane Research.
India however has more recently briefly overtaken China in a sign that the crypto economy is starting to boom in the country.
Trading volumes there have shot up 87% since the central bank diktat was overturned in March 2020, making India a key region of growth.
This may be due to numerous factors. Inflation there is high at 7.6% with Indian Rupees (INR) constantly losing value against the dollar even as the latter weakens itself.
Then there’s the fact India is a huge remittance economy, with $83 billion worth of remittances sent in 2019, accounting for 2.9% of their GDP which stands near $3 trillion.
Some of this remittance may be sent in bitcoin or other cryptos for faster and even cheaper transfers, leading to the rise of Paxos which specializes in crypto remittances.
Then there’s the distrust caused by the withdrawal of high value notes which led to long queues at ATMs in 2016, making alternatives like bitcoin appealing as a backup.
There’s also the tech aspects. Ethereum’s smart contract based decentralized finance has brought new innovations like flashloans.
As the world’s outsourcing center for coding, India is well placed to take advantage of those innovations, with Gujarat in particular a potential crypto hotspot.
That can contribute to economic growth as Indian cryptonians develop blockchain related coding skills, giving rise to new startups to serve both India and perhaps globally.
On the latter, bitcoin can be very useful for international trade especially with small businesses in countries like South Africa where there are strict capital controls.
In countries like India where many don’t have bank accounts, bitcoin can also open access to the global digital economy, bringing India into the fold.
Thus volumes are now rising there and significantly as democracy once again shows why it wins over authoritarianism: the freedom to innovate, to tinker, to come up with better ways and with alternatives without anyone able to stand in the way of progress through capricious diktat.