India is recording a shift in cryptocurrency interest, with smaller cities emerging as new hubs for investors in digital currencies.
Data from cryptocurrency exchanges operating in the country indicates that investors from the smaller towns are not only focusing on Bitcoin but other digital assets, The Economic Times reports.
One of the exchanges, WazirX, notes that it has recorded a 2,648% growth in sign-ups from small cities that have been classified into tier-2 and tier-3 cities.
“In fact, tier-2 and tier-3 cities have driven almost 55 percent of total user sign-ups on WazirX in 2021, thereby overtaking tier-1 cities, which demonstrated a sign-up growth of 2,375 percent,” said Nischal Shetty, CEO at WazirX.
At the same time, the new crypto investors are also varying in age and education status. The exchange has reported an influx of investors below 35 years old, mostly IT professionals, MBA graduates, engineers, and startup owners.
Notably, the investors are diversifying their investments from assets like Bitcoin to emerging technologies like the decentralized finance (defi) and NFTs.
Furthermore, exchanges like BuyUcoin have also recorded similar trends. According to the exchange, a city like Bhopal has registered a 100% increase in new investors in 2021.
To attract and retain the new crop of investors, the exchanges are now introducing a host of new products that mirror systematic investment plans (SIPs), lending, staking, and margin-trading.
Driving force behind new investors
According to experts, the new investors are influenced by social media and aggressive marketing strategies adopted by players in the sector. Notably, the coronavirus pandemic also likely influenced the investment trend.
During the pandemic, most professionals embarked on remote working and had time to invest and capitalize on the growing crypto market that surged this year.
Interestingly, crypto investment is recording a boom despite India attempting to have a clear cryptocurrency regulatory framework. Currently, the center of debate in the country is on the legality of digital currencies.
To navigate the regulatory hurdle, exchanges are now offering products such as peer-to-peer (P2P) services.