Cryptocurrency Trading, User Registrations Increase in India on Stable Bitcoin

Bitcoin prices have consolidated in an increasingly narrow range, while global equity and bond markets continued to tread challenging terrain with mounting stress in sovereign debt and currency markets this week.

On a 30-day basis, Bitcoin is up around 2%. In the traditional asset markets, the S&P 500 in the US is down 3%, while in India the BSE Sensex is down more than 1% on a monthly basis. The markets have seen a decent peak in the last few days. In the foreign exchange market, the rupee fell close to 3% in September.

Shivam Thakral, CEO, BuyUcoin, said the Bitcoin-rupee trading pair is gaining traction from seasoned investors. “The main reason behind this trend is the falling rupee and underperforming stock markets, which push investors into digital assets. High inflation results in rapid wealth depletion, and investors look to digital assets like bitcoin as a store of value to prevent inflationary damage to wealth,” he said.

BuyUcoin saw a 40-45% increase in the Bitcoin-rupee trading pair and a 30% jump in new user registrations in the second quarter of fiscal year 2023. Crypto exchange Unocoin is also witnessing a similar trend.

“Compared to August, we have seen September as a better month. User registrations per day are up 20% and volumes are up 40%,” said Sathvik Vishwanath, Co-Founder and Chief Executive Officer (CEO) of Unocoin.

This surge in crypto activity in India has come as a respite for exchanges, which have been battling the crash in trading volumes due to strict rules on crypto taxation and crypto winters. In the global markets, Bitcoin and Ethereum are trading around 70% below their all-time highs.

The Bitcoin trading number in India varies from the global trend. Most risk asset prices and volumes are mainly driven by global macro liquidity events. However, in India’s crypto market, the price volatility of INR-USD also affects the markets, especially the USDT-INR pair.

“Overall, the Indian market has a premium of around 5% due to lower liquidity across exchanges for various reasons. Additionally, the rupee lost around 2% against the dollar in the last two weeks, compounding this premium and hence the increase in trading activity,” says Mahin Gupta, founder of Liminal, a digital wallet platform.

However, some experts are wary of the surge in crypto activity. Crypto trading and user registrations may have increased, but it has been on a low base, according to Sidharth Sogani, founder and CEO, CREBACO Global, a research, assessment and intelligence firm focused on blockchain and cryptocurrencies.