On November 8, the day Prime Minister Narendra Modi announced that Rs 500 and Rs 1,000 banknotes would cease to be legal tender, Bitcoin was priced at about Rs 52,000 on leading Bitcoin trading exchanges Unocoin and Zebpay. On that day, the international cost of one Bitcoin, when converted into Indian rupee, stood at Rs 46,942. So, the difference between the cost and trading quote came to about 10%. Compared with that, the trading price at present is Rs 63,000-64,000, while the international price is around $740 (about Rs 51,000) – a difference of over 25 per cent.
Sandeep Goenka, CEO of Zebpay, India’s largest Bitcoin exchange by volumes traded, says: “There is a surge in interest for Bitcoins. Indians are inquiring about Bitcoins as an alternative and safe investment option. They are downloading Zebpay as they want to experiment with digital currencies. There has been a 50% increase in Zebpay downloads.” Google search data show that Indians’ search for the keyword ‘Bitcoin’ was at its peak soon after demonetisation.
Sathvik adds: “It cannot be easily imported because of capital controls in India,” so the supply is always less than demand. But his company Unocoin targets Indians abroad looking to send remittances home. The best way, he suggests, is to buy Bitcoin on an international exchange and transfer it to India, where it can be immediately sold on a Bitcoin exchange. The transfer can take place through blockchain, a transparent public ledger. The Indian receiver, while encashing it, gets a premium and all deals are done using the banking channel, with proper know-your customer records.