Cryptocurrency Trading Activity on Indian Exchanges Reaches a 10-Month Peak

Recent surges in Bitcoin value have reignited activity on Indian cryptocurrency exchanges, as leading platforms saw trading volume reach levels not seen in ten months during February.

Cryptocurrency analysis firm Crebaco revealed that Indian trading platforms CoinDCX, WazirX, and BitBNS registered trades worth $2.6 million, $3.4 million, and $7.8 million, respectively, in February. These figures represent the highest activity since June 2023, yet they still fall short of the record highs of 2021.

“The recent surge in exchange trading volumes is attributed to an enhanced global sentiment and increased demand. We anticipate 2024 to be a landmark year for cryptocurrency, though the trading volumes might be moderated by the tax policies from the Centre,” commented Rajagopal Menon, the Vice-President of WazirX.

Currently, Bitcoin is being traded at a price of $65,000, which is about six percent below its highest value reached in November 2021.

Accelerated purchases of Bitcoin by new exchange-traded funds are driving the demand for the foremost cryptocurrency, which is outstripping the supply from long-term investors willing to sell. So far this year, Bitcoin has appreciated by 50 percent, with most gains happening in the recent weeks due to increased inflows into US Bitcoin funds.

Analysts predict the positive trend will likely persist as Bitcoin approaches a halving event set for April 2024, which could add further upward pressure to both demand and price.

A renewed interest in the digital currency has led to modestly elevated trade volumes on Indian exchanges, still recovering from the 2022-23 market downturn and affected by the Centre’s 30 percent tax on cryptocurrency gains.

“Comparing the last three months, deposits have swelled by 80 percent, total transactions have doubled across the platform, and signups have grown by 200 percent,” Menon elaborated.