Cryptocurrencies provide a cheap alternative to remit money than the traditional banks and money transfer companies.
Indians are gradually adopting cryptocurrencies to remit money from abroad, according to an Economic Times (ET) report from Monday.
A reason for adoption is that crypto-assets offer real-time transactions and save commissions charged by money transfer companies and intermediaries.
“The process of remittances through cryptocurrencies into India is a lot more efficient and faster than the conventional process, and all transactions are visible on the blockchain network from a regulatory point of view,” said Edul Patel, CEO of Mudrex, a global crypto investing platform.
Industry trackers opine that the spread of Digital Assets to rural areas and towns is resulting in more experimentation by users.
As per a World Bank report, India receives around $80 billion in remittances each year which are channelled mainly through traditional banking and money transfer companies. That is close to 1% of the GNI (PPP).
The industry trackers are of the view that the proportion of the remittances channelled through crypto assets is poised to grow, especially because transferring smaller amounts can be quite expensive.
Most remitters prefer using Stablecoins to not lose money while transferring. “While remitting money, users would want the value to remain as intended, unhindered by market volatility. Stablecoins pegged to the US dollar are the preferred choice for doing such transactions. Users mostly use stable currencies like USDT/USDC to do these transfers,” further explained by Patel.
Regulation would make cross-border transactions seamless and cheaper. So, India can save a lot on remittances if crypto-assets come under a regulatory framework. Moreover, India has the largest diaspora in the world at 18 million, remittances might contribute to the Indian economy for a long time.
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