Indians are not missing Bitcoin rally despite heavy taxes, trading volume reaches 10-month high

Cryptocurrency trading in India has seen a significant surge, reaching a ten-month high in February, as per a report by Business Line. Data from a cryptocurrency research firm, Crebaco indicates that trading volumes on Indian exchanges CoinDCX, WazirX, and BitBNS amounted to $2.6 million, $3.4 million, and $7.8 million, respectively, marking their highest levels since June 2023.

Despite this uptick, trading volumes remain below the historic highs witnessed in 2021. The surge in trading activity follows a period of low volumes experienced by these exchanges during the bear market of 2022-23, exacerbated by a 30 per cent tax imposed by the government on cryptocurrency trading.

According to industry experts, there has been a notable increase in deposits, total transactions, and sign-ups across platforms in recent months. Bitcoin, currently trading at $67,000, is experiencing heightened demand in the Indian market, largely driven by the ongoing rally in its price and growing institutional interest.

Institutional investment in Bitcoin, facilitated by the launch of Bitcoin exchange-traded funds (ETFs), has contributed to the surge in demand. This increased accessibility to Bitcoin through traditional investment channels has fueled excitement among investors. The rise in demand is also attributed to new exchange-traded funds purchasing Bitcoin at a rate surpassing the willingness of long-time holders to sell their holdings.

The bullish trend in cryptocurrency demand is expected to continue, especially as Bitcoin approaches a halving cycle in April, potentially leading to further increases in demand and price.