Indian Crypto Investors Cheer As Prices Rise

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Mumbai: Indian crypto investors, who suffered significant losses throughout 2022, are now experiencing some relief thanks to the price appreciation of major cryptocurrencies in the first quarter of 2023.

Bitcoin’s year-to-date gains during the Jan. 4-April 4 period were 68.56%, as of 5 p.m. Tuesday on Coinmarketcap.

After starting the year at around $16,000, it is currently trading at $28,280, marking its best quarterly performance in two years.

Ethereum, the second largest token, rose 49.55% to $1,861.93. Experts said that cryptocurrencies have gained momentum thanks to the expected easing of monetary policy and banking disruptions which have highlighted the usefulness of tokens. According to CoinMarketCap.com, the collective market value of all cryptocurrencies jumped 49% in the first quarter to $1.18 trillion.

But despite a promising start to the year, most Indian crypto enthusiasts remain cautious about the prospect of a turnaround and putting the difficult bear market behind them. “I would say that 2023 has been a hopeful but confusing year for investors. Buying for fear of missing out on ‘the next bull run’ and some, including me, remain big on cash for now. Like us we did it last time with the rise of DeFi,” said Chahal Verma, a Gurgaon-based crypto investor.

A group of investors, who had invested early and were back in the black, used this rebound to exit digital assets. “Cryptos have done very well this year, and I took the opportunity to withdraw 85% of my crypto portfolio. Partly because of the regulatory crackdown on cryptos in the US, rising interest rates ( funding winter) and poor adoption of web applications3. Bitcoin has shown some signs of being an anti-fragile asset during this banking crisis, however, its high correlation to NASDAQ is still troublesome, making it a risky asset,” said Ashwini Nadar, a Mumbai-based software engineer.

When asked if he would invest in cryptocurrencies again, Nadar replied, “No, I won’t, at least as long as I live in India.” Although Indian exchange volumes were hit hard after the announcement of a 30% crypto tax and the exodus of crypto investors to global exchanges, trading is stabilizing at low levels. “Total trading volume between January and March 2023 was around $0.5 billion, with trading volume for the top 10 tokens reaching around $300 million. to figures for the fourth quarter of FY21-22, the exchange saw a 58% increase in trading volume from the third to the fourth quarter of FY22-23 We saw approximately 200,000 listings during the same period,” said Rajagopal Menon, VP of WazirX, one of the largest crypto exchanges in India.

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