The relationship between Bitcoin and India is complicated. On the one hand, Indian citizens want to accept the emerging digital economy, but on the other, India’s government is hostile against decentralized currencies.
According to a study conducted by the Indonesian firm Pundi X, about 1 in every 10 bitcoin transactions worldwide takes place on the Indian subcontinent, reported Quartz.
Pundi X’s president, Constantin Papadimitriou, revealed to Quartz that it surveyed 3,000 respondents across India, Indonesia, Japan, Russia, the UK, and the US.
Bitcoin is popular in India, but Indians are only investing in it to gain short-term profits, as there are hardly any places that they can use their digital tokens. A year ago, Bitcoin-friendly businesses such as restaurants and gift shops were popping up in metropolitan areas, but fear of the authorities forced them to cancel these payment options.
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The Indian finance ministry issued multiple notices warning the population to consider the risks involved in cryptocurrency investments and not to jump on the crypto wagon. Finance minister Arun Jaitley himself told the press that the government does not consider digital currency legal tender. The ministry even compared Bitcoin to a Ponzi scheme.
The Reserve Bank of India, the Indian central bank, has also made public its distaste of digital currency, and the tax authority has started to investigate the exchanges. It has sent notices to half a million high-net-worth Indians with investments in cryptocurrencies.
Amid all the tension, Pondi X, which is expanding its business internationally, is delaying its plans to enter the Indian market.
After its scheduled initial coin offering from January 21st to 31st, Pondi X is planning the launch of its point-of-sale terminal for cryptocurrencies in Singapore, Indonesia, Africa, and Brazil. But with such enthusiasm for cryptocurrency in India, the company is not excluding the country from its list.
Other than Bitcoin, emerging altcoins like Ripple and Ethereum are also popular among the general population of India. Koinex, one of the few exchanges offering the XRP/INR trading option, has recorded around $34 million in XRP/USD trading in the last 24 hours, as compared to a mere $3 million in Bitcoin, according to coinmarketcap.com.