June 13, 2025
By Our Correspondent
Cryptocurrencies are quietly reshaping the backbone of India’s e-commerce industry its loyalty programs. As customer expectations evolve, major platforms are leveraging blockchain and tokenisation to offer more engaging, secure, and value-driven reward systems.
India’s loyalty market is rapidly growing. From an estimated $4.8 billion in 2023, it is expected to cross $8 billion by 2028, growing at over 10 percent annually. In this evolving landscape, crypto has emerged as more than just a speculative asset. It is now a core part of how brands connect with and retain their customers.
A standout example is Flipkart’s FireDrops initiative, a Web3-based loyalty program launched in 2023. It quickly gained traction with more than 3 million users onboarded. Flipkart recently partnered with Polygon Labs to integrate a zero knowledge proof powered Layer 2 network, helping the platform scale rewards while keeping transaction costs low. This move makes loyalty programs more efficient and flexible, ultimately delivering more value to users.
Crypto-backed loyalty systems allow businesses to issue, manage, and redeem rewards seamlessly using blockchain. These systems enhance transparency, foster trust, and allow customers to access or convert their points with greater ease and flexibility. With the use of stablecoins and wallet integration, businesses can minimise volatility risks and ensure smooth user experiences.
Across the industry, this trend is gaining momentum. Players like Amazon, Paytm, and Tata Neu are exploring or have already launched blockchain-enabled loyalty programs. Even smaller businesses are testing crypto rewards, cross-brand point ecosystems, and carbon-neutral incentives to drive customer engagement.
The push for digital rewards is closely tied to India’s e-commerce boom. The sector reached a value of $147 billion in 2024 and is expected to grow steadily in the coming years. Increasing smartphone penetration, wider internet access, and strong UPI adoption are all fueling the demand for smarter, personalised loyalty strategies.
While the opportunities are exciting, there are also challenges. As loyalty tokens become digital assets, questions around data privacy, taxation, and compliance are surfacing. Companies will need to stay ahead of regulations and integrate secure infrastructure.
Still, the direction is clear. For India’s digital economy, crypto-enabled loyalty programs are not just a trend but a strategic shift. They promise deeper engagement, higher retention, and stronger brand loyalty in a future where digital and financial experiences continue to merge.
