India leads global crypto adoption for second year in row

September 13, 2024

By Our Correspondent

For the second consecutive year, India has emerged as a leader in the global adoption of cryptocurrencies, as investors navigated the country’s stringent regulatory environment and high trading taxes, according to a report released by blockchain analytics firm Chainalysis on Wednesday.

The report, which assesses adoption across four sub-categories in 151 nations, indicated that India ranked prominently in the utilization of both centralized exchanges and decentralized finance assets from June 2023 to July 2024.

Since 2018, India has maintained a rigorous approach towards cryptocurrencies, with the Financial Intelligence Unit (FIU) issuing show-cause notices to nine offshore cryptocurrency exchanges in December 2023 for failing to comply with local regulations.

Eric Jardine, the research lead at Chainalysis, noted, “India has achieved a considerable level of adoption across various crypto assets despite existing restrictions, suggesting that new entrants to the crypto market have likely engaged through services that remain permissible.”

He added, “We are beginning to observe a gradual easing of some of these restrictions, as seen with Binance, which is expected to further enhance adoption within the country.”

In June, Binance, the largest cryptocurrency exchange globally, faced a fine of Rs 18.82 crore ($2.25 million) shortly after registering with the FIU to resume its operations in India. Meanwhile, the crypto exchange KuCoin registered with the regulatory body in March and incurred a lesser penalty of Rs 34.5 lakh (approx. $41,000)

Notably, seven of the top twenty nations in Chainalysis’ global adoption index are located in Central and South Asia, including Indonesia, Vietnam, and the Philippines.

Responding to the news, Edul Patel, co-founder and CEO of Indian crypto exchange Mudrex wrote on LinkedIn: “Many Indians are seeing crypto as an alternative investment class diversifying their portfolio.”

“Crypto platforms in India are becoming more user-friendly, with simplified KYC processes, regional language support, and easy payment options like UPI (United Payment Interface),” he added.