India’s crypto evolution: a rollercoaster ride

5 min readJun 21


Cryptocurrency has come a long way since its inception in 2009 in the form of Bitcoin. The first commercial transaction occurred in 2010, and soon after, the first cryptocurrency exchange opened its doors in 2013. This revolutionary concept has garnered significant interest in India over the years, with industry estimates suggesting that there are currently 15 to 20 million crypto investors in India, holding around 41 thousand crore rupees ($5.37 billion) worth of digital assets.

This growing popularity can be attributed to several factors, such as the rapid internet adoption, a burgeoning tech industry, and the growing cohort of tech-savvy millennials providing the right consumer segment for cryptocurrencies. In this article, we explore the evolution of cryptocurrency in India, covering the background, key players, bull runs, meme coins, regulatory landscape, comparisons with other markets, and future prospects.

The Emergence of Cryptocurrency in India

Cryptocurrency’s journey began with Bitcoin, an innovative peer-to-peer digital currency that enabled secure and transparent transactions without the need for traditional financial intermediaries like banks. This invention attracted Indian investors seeking innovative financial solutions as the nation began developing an appetite for new technologies.

The likes of Zebpay (2013), Unocoin (2013), and Coinsecure (2014) were among the first Indian exchanges, offering users a platform to trade cryptocurrencies.

Cryptocurrency has taken India by storm, with a reported 97.5 million people owning some form of digital assets. This constitutes 7.1% of India’s total population, which has only grown since November 2021, with crypto ownership now at 29.9%. According to Finder’s Report data, this marks a doubling of value within a mere five months. It is no surprise that India ranks second in overall index rating on the Chainalysis Global Crypto Adoption Index, behind only Vietnam.

Crypto Bull Runs: A Tale of Fortunes

Bull runs have played a crucial role in boosting the adoption and value of cryptocurrencies in India. These cycles have triggered more media attention, attracted more investors, and resulted in the development of various innovative projects.

During bull run periods, cryptocurrencies experience a surge in value, attracting more investors and boosting adoption and overall market capitalization. These periods are usually correlated with Bitcoin halving cycles, which occur every four years and reduce the number of bitcoins mined. This reduction in supply drives up the demand and results in an increase in BTC’s value.

The first cycle of the bull run occurred between 2012 and 2014. During this Bitcoin’s value surged by 10 times — from $100 to $1,000. This significant increase in value attracted a wave of investors and contributed to the growing popularity of cryptocurrencies. The crypto market capitalization also grew exponentially, multiplying 160 times from $75 million to $12 billion within just two years.

The second bull run, from 2016 to 2018, was a period of explosive growth for Bitcoin. Its value skyrocketed from $1,000 to $19,000. Bitcoin now captured mainstream media’s attention and attracted a surge of new investors. This phase was crucial to expanding the adoption of cryptocurrencies and catalyzed the development of decentralized finance (DeFi), non-fungible token (NFT), and GameFi projects.

The most recent bull run cycle commenced in 2020 and extended into 2021. During this period, Bitcoin’s value climbed from $13,000 to reach its all-time high of $69,045. The remarkable surge in value led to major institutional investors such as MicroStrategy, Tesla, and Square investing in Bitcoin, propelling its acceptance and integration into the mainstream financial world.

Furthermore, this latest bull run also witnessed a substantial increase in the overall crypto market capitalization, surpassing $2 trillion in April 2021. This remarkable milestone significantly accelerated the adoption of cryptocurrencies and positively impacted various crypto-related businesses and projects.

Meme Coins Craze: A New Frontier

India-based leading cryptocurrency exchange, WazirX, revealed to a leading newspaper that its top holding was Shiba Inu (SHIB), a digital token with a dog-themed motif. As of January 17, 2023 SHIB was the 15th largest cryptocurrency by market cap. The exchange held just over 19% of its total assets in SHIB, valued at around $63,804,084 on that day. In contrast, its Bitcoin holdings were valued at just over half of that figure, totalling around $28,366,065. While it may sound like investing real money in a playful asset, many cryptocurrency investors have their own line of thinking.

Rajagopal Menon, Vice President at WazirX, explained that Shiba Inu and Dogecoin are held in high regard by many Indians, as the digital tokens represent what is close to their hearts. Furthermore, smaller “ticket sizes” associated with meme-based cryptocurrencies, such as SHIB, mean that customers receive more whole tokens in exchange for their investments compared to the more expensive Bitcoin. Menon elaborated that SHIB provides customers with a gateway into the world of crypto, offering a sense of ownership with a less substantial investment. Memes have played a role in the development of cryptocurrencies, notably with Dogecoin, which was created simply to be a joke in 2013.

Regulatory Uncertainty: Threat or Opportunity?

Despite the immense growth, India’s journey with cryptocurrencies has been a rollercoaster ride, marked by regulatory changes, cautionary circulars, and a ban later overturned by the Supreme Court. In 2013, the Reserve Bank of India (RBI) issued its first warning on the risks associated with digital currencies. This paved the way for regulatory discussions, resulting in a ban on banks, NBFCs, and payment system providers from dealing with virtual currencies in April 2018.

However, the crypto community in India launched the #IndiaWantsCrypto campaign in response to the ban. Eventually, the Supreme Court struck down the RBI circular in March 2020, reinvigorating the crypto market in India.

In January 2021, the Indian government proposed a ban on private cryptocurrencies and the development of a sovereign digital currency. Still, in November 2021, the Standing Committee on Finance recommended regulating cryptocurrencies instead of banning them, and Prime Minister Narendra Modi led a discussion on the topic in December 2021.

In the 2022 annual budget, the Union Finance Minister revealed plans to impose a 30% tax on cryptocurrency investments. Nevertheless, the proposed measure has not yet received legal status in India. Recently, the government has prepared a consultation paper on cryptocurrencies with inputs from domestic institutional stakeholders, the World Bank, and the IMF. A government official expressed confidence in the near-finalization of the consultation paper.

The way ahead

India has been at the forefront of cryptocurrency adoption, with more and more millennials from tier-2 and tier-3 cities getting on board. Interestingly, women’s participation in crypto trading has seen a remarkable increase of over 1000% in recent years. The youth leads the way, with 66% of all users below 35. It’s not hard to see why they are so interested in crypto — they are naturally skeptical towards traditional financial institutions. They are drawn to the excitement of volatility and the convenience of digital technology.

P2P platforms have also played a significant role in driving adoption among the tech-savvy crowd. As the mainstream acceptance of cryptocurrencies grows, we’ll likely see even more niche population segments getting involved. While there is still some uncertainty about regulations, it’s encouraging to see that the government is starting to recognize the potential of cryptocurrencies. All signs point to crypto being the way of the future.




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