Even gold fans prefer to invest in crypto in India

India Prefers Invest Cryptocurrencies Gold Fans

The titanic fight between cryptocurrencies and gold has endured between traders and investors for a long time. The topic to be discussed always focuses on which of the two assets will end up being the definitive safeguard asset. Well, it is well known that gold historically fulfills this function. However, even gold fans seem to prefer investing in crypto.

Also, this phenomenon is being observed more in India. Well, it was known that the vast majority of gold investors came from this region. However, it is now being observed how traders in India are choosing to safeguard their capital in cryptos, instead of gold.

Even gold-obsessed Indians are pouring billions into crypto

In India, where households own more than 25,000 tons of gold, crypto investments grew from around $200 million. This almost $40 billion in the last year. This according to Chainalysis. That’s despite outright hostility towards the central bank’s asset class and the proposed blockchain trade ban.

In this way, Richi Sood, a 32-year-old entrepreneur, is one of those who strayed from gold to crypto. Well, since December, he has invested just over 1 million rupees ($13,400), in crypto such as Bitcoin, Dogecoin and Ether.

And he’s been lucky with his chance. It claimed part of its position when Bitcoin surpassed $50,000 in February. And he bought back after the recent crash, allowing him to finance the overseas expansion of his education company Study Mate India.

“I’d rather put my money in crypto than in gold,” Sood said. “Cryptocurrencies are more transparent than gold or property and returns are more in a short period of time.”

Interest in cryptocurrencies continues to grow in india

This is just part of a growing number of Indians, now numbering over 15 million, buying and selling crypto. That’s reaching 23 million traders of these assets in the US and compares to just 2.3 million in the UK.

Growth in India comes from 18- to 35-year-old crypto traders, says the co-founder of India’s first crypto exchange. The latest data from the World Gold Council indicated that Indian adults under the age of 34 have less appetite for gold than older consumers.

“They find it much easier to invest in cryptocurrencies than in gold because the process is so simple,” said Sandeep Goenka, who co-founded ZebPay and spent years representing the industry in discussions with the government on regulation. “You go online, you can buy cryptocurrencies, you don’t have to verify them, unlike gold.”

One of the biggest barriers to wider adoption is regulatory uncertainty. Last year, the Supreme Court struck down a 2018 rule banning crypto trading by banks. Which resulted in an increase in trade.

Rejection by authorities may influence mass adoption of crypto

However, the authorities show no signs of embracing cryptocurrencies. The nation’s central bank says it has “big concerns” about the asset class. And six months ago the Indian government proposed a ban on trading digital currencies, although it has not said anything on the matter since then.

In this way, a banker that Bloomberg spoke with, who invested more than $1 million in crypto assets, said that, with no clear income tax rules currently, he was concerned about the possibility of retrospective tax raids if it became publicly known. that he was a major crypto investor.

Thus, it already has contingency plans to move its operations to a foreign bank account in Singapore should a ban be introduced.

To be sure, the value of India’s digital asset holdings is still a small part of its gold market. Still, the growth is clear, especially in trading: The four largest crypto exchanges saw a daily increase in trading of $102 million from $10.6 million a year ago, according to CoinGecko.

Finally, for now, the increasing adoption is another sign of the willingness of Indians to take risks within a consumer finance sector that is rife with examples of regulatory failures.