It seems the government may classify crypto currencies depending on the technology they use, as well as their end uses. Are they an asset, are they a commodity, or are they a currency?
Absolutely, I think that is a really positive step for the entire ecosystem. In fact, everyone is finally happy about this classification because before this it was all about putting crypto under one basic umbrella of currency and now there is finally talk about how to classify into various categories.
So, asset or commodities is one of the many categories. There is also the obvious one: currency. But the majority of the use cases they fall under are utility. The fourth is a security. So, there are four major classifications of crypto and it is a welcome move for the entire industry. We are all excited; it is a great progress for the entire ecosystem.
As someone who has high stakes in this ecosystem, has the regulatory uncertainty hampered your growth in any way? Your company and others in the space seem to be growing leaps and bounds. How many more users have been added just in the last one year during the pandemic when investors of all kinds have cropped up?
In terms of absolute numbers, I think on our exchange WazirX alone we have added more than 4 or 5 million people in – not even one year – under seven to eight months. That is a massive number of people entering the whole crypto ecosystem. As an industry we are now well over 15 to 17 million people in the whole ecosystem and that is just testament to the fact that everyone in India is looking forward to crypto as an asset class.
Now your question about whether this is hampering growth. For sure, that is a yes. It is hampering growth, not just for one or two companies, but for the entire sector. Let us take for example investments in startups in the sector. India still ranks as one of the lower numbers compared to anywhere in the world like US and UK. In terms of even the number of start-ups that has grown large in India, it is considerably lower compared to the rest of the world.
This is the regulatory uncertainty playing. Despite this, the growth and the number of people entering the ecosystem is really going well. But ultimately, we are in a financial sector and regulatory clarity brings in more investor confidence, which is the most important thing that this sector needs. So, we are all pushing for regulations in the sector as an industry.
