Indians have a clear favourite when it comes to cryptocurrencies. The world’s largest virtual currency by market capitalisation—bitcoin—is the most traded cryptocurrency in India. Since March when the ban on cryptocurrencies was revoked, bitcoin accounted for 20% of the total traded volumes on WazirX, one of the popular cryptocurrency exchanges in India. Over the last six months, bitcoins worth $184 million were traded on WazirX’s platform.
On CoinDCX, another popular crypto exchange, around 78% of the Indian users trade bitcoin since April this year. “Bitcoin is the flag bearer of cryptocurrencies. Also, it’s more liquid and the less volatile compared to other currencies. Hence, most people come to the exchange to buy bitcoins,” says Nischal Shetty, CEO of WazirX. Tether, which is seen as a stable coin as it is pegged against US dollar but this claim hasn’t been verified through a public audit, was the second most popular virtual currency on WazirX.
Bitcoin is one of the base currencies for buying altcoins if a user doesn’t want to use sovereign-backed money to trade. This too has pushed up the demand for Bitcoin. Indians, who see cryptocurrencies as a long-term investment, usually buy bitcoin, whereas day-traders usually prefer other virtual currencies, which fluctuate heavily, Shetty of WazirX said.
What has further helped is the surge in the valuation of bitcoin after the outbreak of the pandemic in March as well as an endorsement from some Wall Street veterans. As cryptocurrencies gain popularity in India, other virtual currencies will also start finding takers. For instance, ethereum, the second largest cryptocurrency by market capitalisation, is gaining popularity on CoinDCX, said its co-founder and CEO, Sumit Gupta. Since April, CoinDCX has also seen investor interest in ripple, tron, and stellar.