Crypto-currency bitcoin still has few takers in India despite its stupendous rise elsewhere. But bitcoin wallet provider Zebpay is confident of rapid adoption in the country in the days ahead and says it can save India $5-7 billion in remittance fee alone every year.
The Singapore-headquartered firm started India’s first bitcoin exchange in 2012, and has offices in Mumbai and Ahmedabad.
India has been at least three years behind the world in embracing the bitcoin. Zebpay says its mobile app downloads have already crossed the 10 lakh mark and trading volumes are doubling every four months.
Wild swings in the non-fiat currency earlier this month did not help generate confidence among potential users.
The digital currency tumbled nearly 35 per cent between September 1 and September 15 in India, but bounced back 24 per cent to trade at Rs 2,79,262 per bitcoin on September 18 compared with Rs 2,25,121 on September 15.
Globally, it plunged some 27 per cent between September 7 and 15 in global markets.
The bitcoin has surged fourfold to trade at $4,208 on September 27, 2017 from $1,000 on January 2, 2017, hitting a peak of $4,950 on September 1. Some argue that many potential investors may have lost a chance to tap an emerging theme for wealth creation thanks mainly to lack of regulatory clarity.
Bitcoin is a revolutionary technology and can help Prime Minister Narendra Modi’s dreams of financial inclusion and Digital India, says Sandeep Goenka, Co-founder, Zebpay.
On Thursday, Indian markets regulator Sebi (Securities and Exchange Board of India) said it was planning a framework to regulate the bitcoin market in India.
At a September 19 meeting, its first, the Sebi panel on financial and regulatory technologies (CFRT), concluded that it might be crucial to regulate bitcoin transactions to ensure that India’s public issue norms are not breached, Mint reported.
Chinese regulators clamped down on crypto-currencies earlier this month, which forced BTCChina, one of the biggest bitcoin exchanges in the world, to announce on September 14 that it would shut down trading activities on its platform from September 30.
Wall Street bankers have been in two camps with their views on the bitcoin. JPMorgan Chase CEO Jamie Dimon recently called the bitcoin a ‘fraud’ and said governments could eventually crack down on crypto-currencies. Morgan Stanley CEO James Gorman earlier this week differed with Dimon and called the bitcoin “more than just a fad.”
India’s central bank says it is not comfortable with ‘non-fiat’ cryptocurrencies, Executive Director Sudarshan Sen said this past fortnight.
But going by Zebpay’s growth projections, RBI might soon have to sit up and take a serious note of the bitcoin.
The trend will continue to rise. In last eight years, bitcoin has witnessed hurdles in the initial phases in every country, but has still grown, says Goenka.
The focus right now is on the potential misuse of the technology. Once people realise the benefit of the technology, they start adopting it. The same has happened in the US, the UK and Japan.
India is going through the same phase of understanding the technology, says Goenka.
This technology has the potential to make India a global fintech hub. It can save billions of dollars in remittance fee that overseas Indians pay to US firms for money transfer back home. “For this privilege, we pay US firms $5-7 billion dollars a year,” Goenka said.
Globally, there has often been talk of a possible bubble in bitcoins, which has grown exponentially over the years.
Goenka is not convinced. The rise in bitcoin prices is no bubble. It is a fundamental technology and would change society sooner than later, he insists.
People who think it’s a bubble are fundamentally averse to the idea of technology or they don’t understand the potential of this technology, says Goenka.