Indian Crypto Adoption Still Tops the World

Key Points:

• Indian crypto adoption ranked first globally for the second year despite regulatory challenges and high trading taxes.
• Indonesia surged to third place in global crypto adoption, with $157.1 billion in digital asset trading, supported by evolving regulations.

A recent report by blockchain analytics firm Chainalysis shows that India maintained its position as the world’s biggest adopter of cryptocurrency for a second consecutive year.

Read more: India SEBI and Central Bank Clash Over Cryptocurrency Regulation

Indian Crypto Adoption Tops Global Despite Regulatory Hurdles

Indian investors have embraced both centralized exchanges and DeFi platforms despite the country’s harsh regulatory environment and high trading taxes. This report underlines a period between June 2023 and July 2024, showing the resilience of Indians against adversities.

India has been quite strong with its regulatory stance regarding digital currencies since 2018, when already regulators were in the process of taking steps to buck up the use of digital assets in the country. In December 2023, it was reported that the country’s Financial Intelligence Unit issued show-cause notices to nine offshore exchanges, including Binance and KuCoin, owing to their failure in adhering to local laws.

In June this year, it imposed a fine of 188.2 million rupees- roughly $2.25 million. Binance, the world’s largest cryptocurrency exchange for leading licensed virtual currency exchanges that make such declarations of KuCoin, faced a much smaller penalty of 3.45 million rupees. As the regulator took its foot off the pedal, peeling some of those restrictions back, operations such as Binance could resume and power further growth in Indian crypto adoption.

According to Eric Jardine, research lead with Chainalysis, Indian crypto adoption is evidence that new entrants have entered the market despite whatever regulatory restrictions are in place.

Asian Countries Prop Up Crypto Growth as Regulatory Regime Evolves

Another fast-growing market in the world’s crypto landscape is Indonesia, which jumped into third place in Chainalysis’ global adoption index, overtaking Vietnam.

While Indonesia has banned the use of cryptocurrencies for payment purposes, it does not prohibit investment in digital assets-it received $157.1 billion in trading inflows in the past year. In April this year, Indonesia inked a treaty with Australia to improve tax compliance and asset identification, further making Indonesia’s regulatory regime on the sector watertight.