The recent sharp rally in bitcoin and endorsement by Tesla Inc chief Elon Musk are behind more-than-usual number subscriber additions on their platforms
A potential ban on cryptocurrencies has failed to dent investor interest in digital currencies as some of the leading crypto exchanges in India have witnessed up to five times jump in new users during February. According to chief executive officers at some of the leading bourses, the recent sharp rally in bitcoin and endorsement by Tesla Inc chief Elon Musk are behind more-than-usual number subscriber additions on their platforms.
CoinSwitch Kuber, which had launched its India-exclusive crypto platform in June 2020, has seen around 139% increase in new users during the first week of February against the same period last month. The company, which has around 30 lakh users in India, saw a similar jump in trading volumes during the period.
“We are seeing an increase in new users from the past 15 days or so. Major reasons are the rise in prices and Tesla news creating huge ripples. The excitement has actually renewed," said Ashish Singhal, CEO and co-founder, CoinSwitch Kuber.
The traffic on Indian exchanges had seen a temporary dip for a few days earlier this month after the government on 29 January had listed a bill to ban all private cryptocurrencies, including bitcoin and ether in India.
“We did saw a selloff during the two days during the Budget, but after that, it’s back to normal," said Nischal Shetty, CEO, WazirX, which has 15 lakh users.
Signups on WazirX have gone up to five times during February compared with January. The crypto exchange, which saw about $1.4 billion in trading volume in January, has already crossed $1 billion in trading volume during the first 10 days of this month. “Overall, February volumes might see three times jump over January’s numbers, and that will be because of the huge rise in the prices," Shetty said.
Prices of bitcoin have surged more than 60% since the start of February, thanks to some of the major corporations such as MasterCard, PayPal, BNY Mellon and Apple adopting the cryptocurrency into their ecosystem. A major push came when Tesla on 8 February disclosed that it had parked $1.5-billion worth of spare cash in bitcoin.
“January was flat, but February has been a great month for us. We peaked around 8 February, when we acquired around 25,000 users in a day," said Shivam Thakral, CEO, BuyUcoin. The crypto exchange, which has around 400,000 users in India, has been adding around 4,000-5,000 daily users in February.
For the first 15 days of this month, BuyUcoin has added 86,827 new users against 29,535 subscribers during the same period last month, witnessing three times jump.
The recent jump in new users notwithstanding, industry professionals are of the opinion that the rise would have been much higher if there was no overhang of crypto ban fears.
“I would be expecting a few thousand users every day, but we are seeing 800-1,000 as of now. Probably, if the bill confusion was not there, we would have seen at least 2.5 times the number of customers," said Sathvik Vishwanath, co-founder and CEO Unocoin, which has around 13 lakh users.
Experts also said that in addition influx of new users, early investors are also holding on to their positions. “Investors are staying put as they are waiting for the final bill, because as media reports even if there is a blanket ban, there will be ample time for long and well as short term investors to exit their positions," said Singhal.
As per industry estimates, around 10 million Indians hold cryptocurrencies worth around ₹10,000 crore currently.
Most industry professionals Mint spoke to are hopeful that there won’t be any blanket ban on cryptocurrencies in India. “There are over 340 startups in India in the crypto space that are employing tens of thousands of people directly or indirectly. It has not happened in the recent history where a government has erased ₹10,000 crore worth of belongings of the people," said Shetty.
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