One of the latest developments in the tech world is cryptocurrency, which has taken the world by storm. Cryptocurrency has penetrated many different sectors, as developments has enabled the blockchain technology behind cryptocurrency to be applied across various sectors.
As a product of this development, cryptocurrency trading has become a hot topic across the globe, including in India, where Bitcoin is leading the charge of cryptocurrency trading. Although there are some regulatory hurdles and high taxes are imposed in India, many Indians are still diving into the crypto world, which has ultimately resulted in India becoming a global leader in crypto adoption.
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The almighty Bitcoin
The cryptocurrency above all cryptocurrencies is Bitcoin, which is often dubbed ‘digital gold’. If you are wondering “what is Bitcoin“, then the answer is really simple: It is a digital asset with a decentralized nature, which has the potential for high returns. Investors worldwide has been trading Bitcoin since its launch in 2009, including a large number of investors from India. The main reason Bitcoin is the almighty cryptocurrency is due to its limited nature: There will only ever exist 21 million coins, which is creating a sense of scarcity and value.
Throughout its lifetime, Bitcoin has endured changing price movements, making it a volatile cryptocurrency. This means the price has had peaks and downfalls, which has constantly kept investors on their toes. However, even though Bitcoin is volatile by nature, the long-term trajectory of its value is upward, which is also why many Indian investors are considering Bitcoin a viable long-term investment.
The role of trading platforms on the market
To facilitate the growing interest in cryptocurrencies, trading platforms have emerged in India and beyond. The purpose of such trading platforms is to serve as intermediaries, making it possible for traders to buy, sell, and trade digital assets, including cryptocurrencies and Bitcoin.
Trading platforms have become a vital part of a growing market. Data from Forbes shows that the cryptocurrency market is forecasted to reach $6.4 billion by 2025. According to Forbes, the number of users engaged in the cryptocurrency market is projected to reach 107.30 million by 2025, with the market’s average revenue to be around $61.5 per user. A big enabler for these trends is trading platforms.
How to navigate the many crypto trading platforms
As the demand for trading cryptocurrencies has been going up, so has the amount of crypto trading platforms available to users. This also makes it important to know how to choose a trading platform, which platforms like Exness can be helpful with, due to the large amount of market insights one can find on their site. To give an introduction to factors to consider, security measures is a good start. Security measures are in place to ensure that the trading platform is employing robust security protocols. You can therefore look for platforms that has two-factor authentication and cold storage for funds.
You should also look out for the overall user experience. The more user-friendly an interface is, the more accessible trading becomes, especially if you are new to trading. If you have set your mind for a specific cryptocurrency, you should always check if the platforms support the cryptocurrencies you are interested in trading. Most trading platforms employ trading fees, charges related to deposits and withdrawals, and other costs related to using the platform. Lastly, you should always research whether the platform is complicit with local regulations, as this ensures your investments are secure.
The regulatory landscape in India
To say the regulatory landscape for cryptocurrencies in India has been a rollercoaster would be an understatement. However, it is a story of progress and ongoing development. In April 2018, the Reserve Bank of India (RBI) issues a circular prohibiting banks from dealing with cryptocurrency exchanges. This circular heavily impacted the industry, to a point where the Supreme Court of India overturned the ban in 2020, which breathed new life into the crypto community in India.
However, since this verdict, some challenges still persist. One such is the high taxes imposed on crypto trading by the Indian government. There is a 30% tax on crypto gains, and a 1% Tax Deducted at Source (TDS) on all sales of crypto assets which exceeds 50,000 rupees. The logic behind these measures is to regulate the market, especially to curb any potential misuse. Another current development in the regulatory landscape is the actions taken by the Financial Intelligence Unit (FIU) to address offshore cryptocurrency exchanges for non-compliance with local regulations.
Predictions for the crypto trading market in India
Crypto trading in India is expected to continue to be a growing market, with great promises for traders. The stance of the government continues to evolve, reflecting global regulatory shifts. Currently, India is reviewing its position on crypto assets, especially focusing on the cross-border nature of these digital currencies.
According to Reuters, the Indian crypto market is projected to continue expanding. Estimates shows that the market could grow to over $15 billion by 2035, with a compound annual growth rate of 18.5%. The component that is fuelling this growth the most is the growing interest from retail investors, which is a trend especially present in smaller cities where traditional job growth and income opportunities are limited.