Till now, Indian investors mostly rushed to cryptocurrencies inquisitively in the hopes of receiving surplus returns. However, given the country’s present economic conditions, they could reap some significant economic gains from their bets.
Seasoned bitcoin advocates believe that investing in bitcoin might serve as a safeguard against inflation. The idea, initially advanced by bitcoin’s enigmatic developer Satoshi Nakamoto in 2008, has sparked much controversy over the years. While there is no definitive confirmation of the idea, there is a reason why Indians would be interested in it right now.
For most of last year, consumer prices in India remained higher than the Reserve Bank of India’s (RBI) objective of 4%. With crude oil prices worldwide rising, there is fear that inflation may climb more in the short future. Furthermore, considering that the Indian reserve bank has been focused on restoring growth to the post-Covid economy, curbing inflation may not be among its present concerns.
With the economy in recession as a result of the Covid-19 outbreak, RBI issued more rupees in the past year to increase demand and stimulate GDP than it did the year before. This surge in money creation is not without cost. When money is in plentiful supply, it promotes inflation because more money is spent to purchase the same quantity of products. Depending on changing macroeconomic conditions, a central bank may raise or reduce the amount of circulating currency.
Meanwhile, Bitcoin prices increased significantly (from Rs. 15,99,817 in the last week of October to Rs. 17,46,325 on November 5th), representing a 1.09% rise. Because the digital currency is not explicitly tied to particular asset classes like oil or real estate, the prices of which grow in tandem with consumer prices, Indian investors can still incur significant returns from bitcoin investments.
Yes, we are aware of the market volatility. That’s why we request our dear Indian investors to follow the vetted roadmaps before proceeding to buy bitcoin!
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