- Evolution of the Crypto Market in India
- Impact of Regulations on Exchanges
- Current Trends and Prospects
In the past few years, the cryptocurrency market in India has evolved significantly. Despite unclear regulations and regulatory uncertainty, the adoption rate is constantly growing.
Evolution of the Crypto Market in India
India is among the nations with the highest cryptocurrency adoption globally, as per the recent report of Chainalysis. Despite harsh & tough regulations over offshore exchanges, India remains on the top of the list for the second continuous year. Earlier in December 2023, the Financial Intelligence Unit (FIU) of India identified over half of the dozens of crypto exchanges as non-compliant with the nation's AML laws.
Impact of Regulations on Exchanges
Following the crackdown by FIU, some leading exchanges such as Binance, Bitfinex, and Kraken, including others, were affected. Some of them were even fined huge penalties for the violation of regulations in India. Despite the restriction of international exchanges, the adoption rate is minutely affected, notes the crypto adoption report published by Chainalysis. Around 40% of the total value received on the centralized exchange in India is still observed post-ban and restrictions. Several other reports claim that after the ban of some specified offshore exchanges, traders and crypto adopters in India are using other available methods to avail services of restricted platforms.
Current Trends and Prospects
The enthusiasm among Indians for digital assets has demonstrated a keen interest in exploring the potential of cryptocurrencies. In Central & Southern Asia and Oceania, India is ranked 1st in terms of overall index ranking, 1st in centralized service value received, 1st in retail centralized service value received, 3rd in DeFi value received, and 2nd in retail DeFi value received. Eric Jardine, the research lead at Chainalysis, said, “India has also got a fairly widespread level of adoption across different assets of crypto despite restrictions, implying new participants to crypto would have been participating via services that were not banned.”
Despite stringent regulations, the cryptocurrency market in India continues to evolve and exhibit a high level of adoption. This indicates a significant interest of the population in digital assets and a desire to explore their potential.
