India has world’s largest number of crypto owners, most under 35

Indians are racing ahead of the world in adopting cryptocurrency, fuelled by curiosity and a desire to get rich fast, especially among millennials.

Even as the Indian government is ambivalent about how to regulate the digital coin ecosystem (the central bank banned it briefly in 2018), a 50-country study by investment portal BrokerChooser found that at more than 100 million, India has the largest number of cryptocurrency owners, followed by the United States and Russia.

Many of them entered the crypto universe only last year, when their number grew seven times, and investments grew from approximately US$923 million (S$1.24 billion) in April last year to US$6.6 billion in May this year.

A different study by Britain-based Kantar consulting found that 16 per cent of urban Indians owned cryptocurrencies, typically men under 35 years who had a “higher risk appetite” than those who invest in bank deposits.

“I was fascinated that I could enter the financial world even before turning 18,” said Gajesh Naik, a 13-year-old student in Goa.

The eighth grader was introduced to the decentralised technology that powers cryptocurrencies in an online seminar in April last year, and now manages millions of dollars in digital money.

“After learning all this through YouTube and Twitter in three months, I began consulting as a freelancer,” said the teenager, whose parents are civil servants.

Gajesh has now designed his own crypto platform that can accept millions of investors’ money, and created elephant-themed non-fungible tokens (digital artwork known as NFTs).

Other young Indians are not far behind.

In his third year of engineering school, Mr Arish Patel from Valsad, Gujarat, spent time in Bitcoin forums and watched every YouTube tutorial available for two years before investing his first rupee.

The 22-year-old saw cryptocurrency prices soar in 2017 and “learnt the risks during the following bear run” when prices crashed.

In 2019, Mr Patel invested 10,000 rupees (S$180) he borrowed from his father, a mango and rose farmer.

Losing some and winning some, he learnt enough to amass a “six-figure portfolio” in US dollars today.

While Mr Patel’s elderly relatives are convinced that “crypto is a financial scam”, his young contemporaries have a “Fomo urge to buy the latest trending cryptocurrency”. Fomo stands for “fear of missing out”.

His answer to both is that “patience and long-term planning” are the key to successful and safe crypto trading.

The volatile currency that has seen catastrophic falls and steep rises in value is not for the faint of heart.

But, during the Covid-19 pandemic, as traditional assets depreciated, people lost jobs and interest on savings fell, many Indians discovered cryptocurrencies as an alternative investment, said Hyderabad-based Abhishek Jain, founder of rBitex crypto exchange.

“Bitcoin in India converts to cash quicker than in most countries, because many of the latest adopters use it to make quick money,” said Mr Jain.

A crypto coin that was US$8,000 two years ago is now valued at around US$60,000, a jump in value that no mutual funds, real estate or equity could match, he added.

The Kantar survey found that Indian investors mostly use crypto exchanges such as WazirX, ZebPay, CoinSwitch and Kuber to make small-ticket investments averaging 30,000 rupees.

The most preferred currency is Bitcoin, followed by Dogecoin, Ethereum and Binance Coin.

Crypto also provides youth job opportunities in a depressed economy, said Mr Vaibhav Gupta, 26, who runs Desi Crypto, which offers viral marketing services to new crypto and blockchain projects.

“So many crypto projects are coming up daily that if you learn about crypto and blockchain, there’s a job waiting for you. Companies launching coins and getting it listed in exchanges need graphics designers, developers, marketers and community managers,” said Mr Gupta, who even pays half his employees in cryptocurrencies.

Crypto consulting is another sphere.

Even before he finished his economics degree in July this year, Kolkata-based Samatak Saha, 22, had enrolled in crypto exchange WazirX’s “warrior programme”.

He is paid to make crypto accessible to the Indian masses, using social media to teach people about the technology, how to avoid scams, organise discussions, do video tutorials and create memes.

He makes about 70,000 rupees a month, more than double the average salary his classmates hope to make working as financial analysts or business developers.

Crypto is everywhere you look in India now.

Newspapers have full page ads for new coins. Two Indian crypto platforms have become unicorns (valued at US$1 billion and more). Crypto exchange CoinSwitch Kuber, the latest unicorn, repeatedly airs an advertisement during cricket match telecasts, where Bollywood actor Ranveer Singh raps in Hindi about it being cool to invest in crypto.

Other Bollywood stars such as Salman Khan and Amitabh Bachchan launched platforms last week to sell digital movie dialogues, posters and artwork, in exchange for cryptocurrencies.

“The danger is that Indians may invest in whatever is trending, good or bad. As the market booms and as government regulation will take time, it’s best for beginners to learn the fundamentals first, and invest only what they can afford to lose,” said Mr Gupta.