There is surely a lot of interest being generated in India around bitcoins in recent times.With approximately 53,000 downloads of bitcoin software over the past six years and a total of 80,000 bitcoin wallets opened to date, as per the estimates of Local bitcoin startups, Bitcoins are creating a strong foothold in India. (Facts as per Newsbtc.com)
The slow rise of Bitcoins in India was very much expected. India typically is a risk averse country with a culture of saving. Adoption of new technology or trends happens a little later in India.It therefore comes as no surprise that Bitcoins have taken some time to create excitement in the Indian market.
However, situation is expected to get much better with establishment of Bitcoin exchange firms which facilitate buying and selling of Bitcoins. Also, there has been an urge by Reserve Bank of India (RBI) governor Mr. Raghuram Rajan for cashless transactions which is expected to help the rise of Bitcoins in India . Here is the video where Mr Rajan explains the same :
In a country that deals with a number of problems due to cash transactions, Bitcoin will be instrumental in changing the face of the financial industry in India.
To shed some light, Bitcoin is a decentralized peer-to-peer payment network in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds. In simple terms, it can be referred as ‘Cash over internet’. The concept of Bitcoin was first described in 1998 by Wei Dai on the cypherpunks mailing list in which a suggestion was given to use cryptography to control creation and management of money, operating independently of a central bank. ( To understand complete concept of Bitcoins click here !)
The operation and flow of Bitcoin exchange can be initiated easily once you install a Bitcoin wallet on your computer or mobile phone followed by generation of first Bitcoin address. Afterwards, you can create more of them as you per need. Next, you are required to disclose your addresses to concerned person so that he/she can pay you or vice versa. You can obtain new coins either by mining new ones or buying on an exchange or accepting them for goods and services.
Bitcoins as a digital currency is being used in a number of countries and the concept is much widely known specially in the USA and China. But the level of awareness in India is far less than in these countries. Currently, in India, Bitcoin is mostly used for saving purposes.
The situation is moving to a brighter side slowly and steadily. This increasing recognition of Bitcoins is being accompanied by concerns raised constantly for regulation of Bitcoin within the country. A number of rules and regulations pertaining to Bitcoins are already in place. Read more about regulations Rules and Regulations here.
The improved situation has triggered inception of firms which have started working on this front. Unocoin, founded by Vikram Nikkam, 38, and Sathvik Vishwanath, 31, is one such lead player in the area of Bitcoins and works towards creating, buying and selling of those. In 2014, Unocoin became the first Bitcoin exchange and merchant processor in India to have raised international funding and is also known for being ‘INDIA’S MOST POPULAR BITCOIN WALLET’.
Unocoin has now between 14,000 to 15,000 users and those numbers are growing exponentially. Out of them, nearly 70% of the users purchase bitcoin for savings purpose. Another 10% – 15% of users are online freelance workers. Another 10% – 15% use it for buying things online like web hosting, server space, etc.
“Investors are showing interest in bitcoin companies not only in India, but globally. More investment has gone into Bitcoin over the past 1 year than what the internet received back in 1995” said Sunny Ray, President Unocoin, while talking about Bitcoins in India. He explained that with regard to India specifically, there are many things that investors are attracted to:
1) Massive market size ~ 1 billion+ people
2) Fast growing internet adoption
3) Large unbanked population
4) Opportunity to offer lower cost remittance
5) Strong companies beginning to emerge from the ecosystem
It will still take a few years before bitcoins in India reach millions of users. It is still very much in the early innovative adopter phase. Much like with the internet, which was slowly adopted in India but later became the 3rd largest internet user base in the world, Bitcoin too is expected to pick up exponentially in the coming few years. The impact that Bitcoin technology will have on the country’s future is expected to be much larger than the impact of internet.