Cryptocurrencies in India are a hot topic for investors and Ethereum is now one of the most discussed cryptoassets in the country. The states of Haryana and Goa have seen the most interest in this new technology – an interest which grew dramatically in December 2017. This page will detail the various Ethereum exchanges which are available to residents in India as well as a number of key points surrounding the regulatory climate and security of Ethereum. A full list of the current Ethereum exchanges can be found below.
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localethereum is an anonymous marketplace for buyers and sellers of Ether powered by smart contracts. Launched on October 20th 2017, localethereum is a new but popular place to purchase Ether from anywhere in the world.
Binance is a cryptocurrency exchange with a daily trading volume that regularly exceeds 2.5 billion US dollars with a membership in excess of 10 million users
Changelly is a rapidly growing exchange which allows users to buy dozens of cryptocurrencies using a credit/debit card or other cryptocurrencies.
Zebpay is one of India's leading cryptocurrency exchanges
CoinFalcon supports dozens of altcoins as well as Ethereum, Bitcoin and Ripple. Note that bank deposits are not accepted; cryptocurrencies only.
India has had a long history of cryptocurrency exchanges with the most notable being Unocoin. Unocoin was initially founded as a Bitcoin exchange in 2013 and has since expanded to include several other cryptocurrencies including Ethereum. The company has raised nearly $2M in funding and continues to be one of the dominant trading platforms for those based in India. Unocoin wasn’t the first cryptocurrency exchange in Ethereum, but it has been the most successful. Other exchanges have since followed suit and the number of crypto traders in India is estimated to be as many as 5 lakhs (500,000).
When considering an exchange at which to buy Ethereum, liquidity (trade volume) is a key factor. An exchange with high liquidity will ensure that a purchase of Ethereum (no matter how large or small) is fulfilled instantly and at a set price. Markets with low liquidity can make purchasing larger quantities of Ethereum a slow process with a wildly varying price.
At the time of writing, the ETH/INR market has an average 24/hour volume of slightly over USD$1M although it has been several times higher during previous bull runs. This volume is relatively small, and places the ETH/INR currency pair at roughly the 250th most active market within Ethereum. For users wishing to purchase less than ₹6,50,000 of Ether, this level of liquidity should be absolutely fine. For larger purchases, it may be prudent for an investor to purchase USD before then trading on the highly liquid ETH/USD market.
The Reserve Bank of India (RBI) began watching cryptocurrencies following the rise of Bitcoin in 2013 and has since released cautionary warnings to banks, users and investors about the risks posed by these assets. The RBI is sceptical of digital currencies – particularly in their use for illegal activity – but has stopped short of calling for an outright ban.
However, the Indian government has put forward plans for the regulation of cryptocurrencies in an attempt to crackdown on illicit activity, details of which came to light in March 2018. Such regulation has provided exchanges, banks and other financial institutions with better clarity on how to deal with cryptocurrencies – particularly from an anti-money laundering (AML) and know your customer (KYC) point of view. In the case to move Ethereum to a more mainstream audience, this type of regulation is essential as a means to develop the ecosystem in India.
Given the lack of regulation, there are a number of risks to dealing with Ethereum in India. While it is unlikely that the government will issue an outright ban, there could be risks that transcend the already very volatile price movements.
No legal protection on transactions
For traditional bank transactions in India, there is a level of legal protection that is given to the parties involved as a means to stamp out fraudulent transactions. With cryptocurrencies however, this legal protection does not exist. Ethereum transactions are incredibly secure and the blockchain has yet to be successfully attacked, however when dealing with a crypto exchange or other third party, the protection that consumers and investors have against a rogue actor is limited.
Risk of confiscation
The government of India has previously taken a hard stance on monetary policy; most recently having removed 500 and 1,000 rupee notes from the economy overnight. It is unlikely that Ethereum will be declared illegal (although it is certainly not considered legal tender) but there is a risk of non-compliant exchanges being shut down. Users who store Ether on a non-complaint exchange risk having their funds lost entirely with no possible recourse. This risk can be mitigated by securing Ethereum safely in a wallet with which you control the private keys. Exact details of wallet security can be found in the guide below.
Ethereum and cryptocurrencies do not have the same utility in India as they do in other parts of the world. Cryptocurrencies are not recognized as legal tender and the Indian government has gone as far as banning cryptocurrencies from their payments system. However, given that the allure of Ethereum to investors is to “buy and hold” and not to spend, this limited use of cryptocurrencies is relatively inconsequential. By purchasing Ethereum in India, it may not be possible to participate in this new digital economy, but an investor will have the benefit of being exposed to the price movements of this growing cryptocurrency.