Recent studies suggest that India is outpacing much of the rest of the world in terms of cryptocurrency adoption, and that’s likely to be good news for anyone who believes in the future of blockchain-based financial tech.
India has emerged as a hub of crypto adoption, according to Finder’s most recent Cryptocurrency Adoption Index. Its most recent report, in August, showed that the top five countries in the world, ranked in terms of crypto adoption, are all located in Asia. That’s a big surprise because most Asian countries were regarded as being off the radar during the early days of crypto development, where most of the action was taking place in the U.S. and Europe. But times change, and Finder’s findings suggest Asian countries are now playing a prominent role in accelerating the adoption of crypto as the future of finance.
Leading the adoption metrics in Asia is Vietnam, where almost 40% of its population claims to hold some kind of cryptocurrency. Vietnam is closely followed by India, where almost 30% of people say they own crypto.
The rapidly growing crypto adoption in India is especially interesting given its status as the world’s second-most populous country and its reputation as something of a technology hub. With its huge population, it means that the number of crypto owners in India is absolutely massive, with Finder estimating that some 279.5 million Indians currently hold some kind of digital assets. It’s hard to know if these figures are inflated or not – after all, many thousands of villages in India still remain without electricity, for example. Even so, the survey shows that crypto is far more common among Indians than it is among the populations of developed countries, which were long considered to be the most open towards digital assets. For instance, Finder’s data, based on a global survey of 217,947 persons, shows that just 13% of respondents in the U.S. currently own crypto.
The U.S. population is lagging behind the times in the crypto space and that’s even more startling given that its government has, until now, always taken a fairly positive stance towards blockchain-based digital assets. Regulation remains non-existent in the U.S., whereas India’s government has taken a much tougher stance, recently introducing a 30% tax on income received from digital assets, as well as a new “transaction tax” – a 1% fee Indians must pay on all crypto trades.
Despite this, a second report by the global crypto exchange KuCoin suggests India’s cryptocurrency market will grow to reach $241 million by 2030, if not higher. The same survey, published at the end of June, backs up the findings of Finder, saying that around 115 million crypto investors in India either currently hold, or have previously traded crypto in the last six months. The report also notes that 56% of Indian cryptocurrency investors believe that crypto is “the future of finance”, and that 52% are investing in the space with the purpose of earning passive income to improve the quality of their lives.
Crypto Going Mainstream In India
The latest statistics support the narrative that crypto is rapidly going mainstream in India. The fact it is doing so is not as surprising as we might expect. After all, India has some advantages that lend itself to crypto adoption. Its population is relatively young in comparison to many countries, and younger demographics tend to embrace digital assets more than older people do. Finders’ report found that people aged between 18 and 34 constitute more than 40% of cryptocurrency users around the world.
What’s more, India has experienced a sharp growth in digital services that make cryptocurrency more accessible to its population. It has an extensive mobile infrastructure with more than 500 million 4G users, that’s not only reliable but also very cheap, in comparison to first-world nations. Moreover, the exposure to crypto has encouraged people to want to learn more about how the global monetary system works, and how digital assets are disrupting traditional financial systems.
All of this comes despite mixed signals from an Indian government that seems to constantly flip-flop on its policy towards crypto. In June, India’s Finance Minister Nirmala Sitharaman told parliament that the Reserve Bank of India had expressed doubts about crypto’s “destabilizing effect” on the country’s monetary and fiscal stability, and was recommending that lawmakers frame legislation around the industry, if not an outright ban.
“RBI is of the view that cryptocurrencies should be prohibited,” Sitharaman told India’s parliament.
At the same time though, India’s Ministry of Finance has been at the forefront of a push to establish laws and regulations around crypto that would make it possible for institutional investors to fund blockchain startups more easily. It is also said to be in the midst of formulating a policy that will put the country at the forefront of Web3 development. Progress appears to have been made here, with the launch in August of a new India Blockchain Forum, an industry group made up of prominent Indian blockchain firms that have the support of Hyderabad’s local government. Hyderabad is noted as the second-largest tech hub in India. The forum has established a ten-point agenda that includes the development of a homegrown blockchain stack, more regularity clarity and assistance for blockchain startups, and creating a talent pool of blockchain developers.
Startups Raising Cash
Advocates of crypto within India’s government believe that the country can benefit by playing a primary role in the development of blockchain technologies. After all, India is said to boast more than 4.4 million IT workers, 80% of whom are said to be computer programmers. Moreover, these IT workers contributed around $180 billion, or approximately 7% of the country’s gross domestic product, to the economy in 2020. It means India has an extremely large talent pool that it can tap into to pursue its ambitions in the thriving Web3 economy.
Entrepreneurs across India are taking the lead, and the country has emerged as a hotbed of crypto startup activity in the past couple of years. Moreover, it has attracted some big investments too. Some of the biggest deals include SoftBank’s mammoth $450 million investment in the Polygon blockchain scaling solution, and CoinDCX’s huge $136 million raise in April. There are plenty of smaller startups raising cash too, such as the treasury management platform Coinshift, which bagged $15 million in funding last May, at a time when the crypto industry was still reeling from the crash of the TerraUSD stablecoin.
It’s not just about the money though, as there are a number of unique Indian projects and startups that are bringing real utility into the local crypto economy. For a long time, crypto’s utility has been seen as a speculative investment or, perhaps, a semi-stable store of value. That’s changing as crypto-focused social media apps like Chingari and Taki give people real reasons to want to buy, sell, earn and spend their cryptocurrency tokens.
Giving Crypto Purpose
Chingari has taken India by storm with its TikTok-like video sharing app. It has become one of the most popular social media apps in the country, ranked number one for downloads on Google Play. One of the reasons for its popularity is that it’s building a unique creator economy with crypto at its heart. With Chingari’s GARI mining program, users and creators can earn GARI tokens – the platform’s native cryptocurrency – by creating videos, sharing them, liking and commenting on others. The GARI tokens can then be sold on a crypto exchange, giving app users a way to earn a passive income.
Chingari provides greater utility through NFTs too. Its recently announced Creator Cuts NFT marketplace enables creators to “tokenize” their most popular videos as NFTs and sell them to fans. Holders of the NFTs can then earn 10% of the daily GARI rewards that video NFT generates. In this way, Chingari is creating a burgeoning crypto-based economy within its app, and it has plans to extend this by letting users sell physical merchandise and more, directly through the app.
Pursuing a similar idea is the Indian startup Taki, which is promoting the concept of “engage to earn”, where social media users can earn crypto rewards each day by engaging with other users. Taki, which has already seen more than 600,000 users sign up for its waitlist, has raised $3.45 million in funding Solana Ventures CoinDCX, OKX Blockdream Ventures, and others
“We are pioneering a new #EngageToEarn model where casual users can earn crypto for just showing up and consuming content, interacting with friends, and making new friends, just as they normally would,” Taki wrote on a Medium post. What’s special about Taki is that both creators and casual users have the opportunity to earn rewards. Creators will be able to receive tips from their followers, and even create and sell their very own cryptocurrency. Moreover, the app has designed a unique “tip-sharing” mechanic known as Gold Taki, which allows popular creators to sell a share of the revenue their posts create. In this way, fans can invest in the future earnings potential of their favorite creators.
Crypto is also promoting a new economic model for video games. Rush Gaming Universe is an Indian-built mobile blockchain games platform that enables players to earn a passive income. At present, it offers ten games on its platform where players can battle against each other in 2-player or 4-player games. In the future it will add newer game formats, including 1,000-player tournaments and clan battles, enabling players to earn even bigger rewards than are currently possible.
Players can compete against each other while wagering on the outcome with the RUSH token, which represents the economic value of the network. With the RUSH that they earn, players can then invest in NFTs to upgrade their game characters and make them more powerful, boosting their earnings potential in the process.
Through its platform, Rush Gaming Universe has already whipped up an impressive crypto gaming economy that was generating more than $50 million in gross annual recurring revenue by January 2022.
Widespread Adoption On The Way
By giving cryptocurrency more of a purpose, these Indian startups are helping to generate much greater enthusiasm among Indians to hold and use digital assets. No longer is crypto only seen as an investment, or an easy way to transfer money. With the likes of Chingari, Taki and Rush Gaming, users now have more ways to use their digital assets, giving them more reason to want to own them in the first place.
It’s clear that India is well on the way towards becoming a global hub for all things blockchain, DeFi, GameFi and NFT development, with its level of digital asset adoption threatening to leave other countries in the dust. If that happens it will be a good thing for India, for blockchain has the potential to vastly improve its overall financial infrastructure, attract international capital and create new business and job opportunities for its population. It can potentially transform India into a blockchain powerhouse – in the process helping it to become the first major country in the world where crypto is used by the majority of its people on a daily basis.
Mass adoption is on the horizon, and India will be one of the first to see it.
