- Date : 27/01/2022
- Read: 4 mins
- Read in हिंदी: 2022 में भारत के लिए क्रिप्टो पर पांच भविष्यवाणियां
Experts say Indians will continue to embrace crypto in 2022 despite RBI concerns.
On 14 January 2022, the World Economic Forum (WEF) said it was launching an initiative around the crypto ecosystem that would bring key players and industry leaders together to shape the future of digital currency.
“The crypto ecosystem is expected to see massive worldwide adoption over the next few years,” said WEF’s head of blockchain Sheila Warren. This is in line with the broad line of thinking in the western world, which sees five trends emerging in the crypto market in 2022. Let’s see what they are:
- Financial advisors to embrace crypto;
- Crypto-specific regulations to come up;
- Women participation in crypto trade to swell;
- Retailers like Amazon to adopt crypto;
- The glitter to fade ultimately.
India’s crypto position
India has officially maintained a cautious approach towards digital currencies. It has not blocked digital assets, but it has also not promoted them either.
In his address to the WEF four days after Warren’s statement, Prime Minister Narendra Modi identified cryptos as a “challenge”, just as supply chain disruptions and climate change, which needed a “synchronised” global effort to regulate.
The Reserve Bank of India (RBI) also expressed concerns over the financial stability of digital currencies like Bitcoin and Ethereum. It had effectively banned them in 2018, though the Supreme Court overturned this in 2020.
RBI is now believed to be mulling allowing cryptocurrencies in India but with effective regulations in place.
India 2022: 5 Trends in crypto
Against this backdrop, what are the crypto predictions for India in 2022? Various stakeholders have given their views, based on which some guesses can be made which way crypto India is headed. Here are the five key takeaways:
1. Popularity will grow
In terms of the number of people who have owned a cryptocurrency at least once, India currently ranks 7th in the world (over 10 crore people). Experts, such as Nirmal Shetty, founder of India’s largest digital currency exchange WazirX, or Vikas Ahuja, CEO of another exchange, Cross Tower India, have said in media interviews that Indians will continue to embrace crypto in 2022 despite RBI concerns. One leg-up will come from its low internet costs (one gigabyte of mobile data costs $0.26 in India, compared with $12.37 in the US and a global average of $8.53).
2. The millennial push
Experts also see crypto emerging as a popular asset class and mainstream investment avenue in India, especially among young earners. In other words, crypto 2022 will be driven by millennials (the country’s median age is around 28 years). They will eventually push retail investment in cryptos to $15.6 billion by 2030.
3. Bullish year ahead
Experts say 2022 is going to be bullish for bitcoin - the benchmark for crypto - and see it emerging as a serious asset class for young earners in India during the year. They expect it to cross the $100,000 mark by the year-end; some even say it will hit a new “all-time high”.
4. Tech disruptions
The RBI is planning to introduce its own digital rupee (central bank digital currency) and expressed interest in blockchain technology. Interest from that source could drive tech-based disruptions that would make decentralised blockchains cheaper, faster, more scalable, and sustainable.
5. New regulations
Finally, the government is expected to provide regulatory clarity on crypto sometime in 2022, lending much-needed legitimacy to the crypto sector. This would not only encourage new investors but also encourage institutional investors to get on board.