India is on the verge of a $5 trillion economy on Bitcoin
Nonsense
Nonsense
The conflict in the Middle East has escalated, and Bitcoin has once again been talked about as a safe-haven asset after its surge. Today, Bitcoin broke through 8,000 US dollars, and the market is even more excited. But what can Bitcoin do in the face of a country's economic downturn? The CEO of CoinDCX, India's largest cryptocurrency trading platform, analyzed how Bitcoin will help India reach a 5 trillion economy in India, where economic growth is currently slowing down.
India has been one of the most compelling emerging economies in the world for the past few decades. Currently, India ranks seventh in the world with a gross domestic product (GDP) of US$2.72 trillion and is expected to overtake the UK in the next few years. Prime Minister Narendra Modi envisions India as a $5 trillion economy by 2024. But realizing that dream is a challenge for a country of 1.3 billion people, given current economic performance. In fact, the adoption of Bitcoin in India may hold the key to its economic future.
If India's GDP is to reach $5 trillion by 2025, its minimum annual growth rate will need to exceed 10.8% per annum. India's current GDP has fallen sharply from 8% in 2018 to 5% in the second quarter of 2019. Manufacturing growth in India fell to a 15-month low in August as sales growth slowed, forcing factories to shut down. Another reason for the slowdown in economic growth is India's rising unemployment rate. The unemployment rate was 8.5% in October, the highest level in the past three years. Foreign equity investors were net sellers of Indian equities in the third quarter of July-September, pulling more than $3.2 billion out of Indian capital markets. India's central government's fiscal deficit is expected to widen to around 3.7% in fiscal 2020, instead of staying below 3.3% as originally planned.
Faced with these lower-than-expected results, the Indian government has taken a series of steps to boost the economy on the supply side by boosting public capital spending and cutting corporate taxes from 35% to 25%. India's central bank, the Reserve Bank of India (RBI), has cut interest rates five times since early 2015 to stimulate consumer spending.
India had liberalized its economy as early as 1991, which helped expand its economy and its role in private investment. Thanks to this radical reform, India achieved developing country status but failed to adopt similar reforms that would have pushed India towards full development. What the Indian government can do is to take measures to stimulate the economic upswing while focusing on opening the door to supplement growth. Now, India has the opportunity to realize this potential by adopting another radical monetary innovation: Bitcoin.
Bitcoin is the most powerful monetary innovation in the world, the idea is to democratize transactions/storage without being controlled by any single authority. Eleven years after its inception, Bitcoin has become the best performing asset class, and more importantly, in the next few years, Bitcoin will move from a mere collectible asset to digital gold status. Recently, Bitcoin’s hash rate just hit an all-time high of 111 EH/s. As the Bitcoin network becomes stronger than it was before, it absorbs proportionally more monetary value every day (or more accurately, every ten minutes). Importantly, a rise in the value of the Bitcoin currency will have a significant impact on the Indian fiat currency. Countries with the weakest monetary policies and currencies are most likely to face the threat of economic failure at the outset. Once they start falling, a domino effect will ensue for all fiat currencies that have adopted the wrong monetary policy and printed too much money. This threat to fiat currencies is the main reason why governments around the world are hesitant to directly adopt Bitcoin. But governments should see Bitcoin not as a threat, but as an opportunity.
Gold was considered a robust store of value long before Bitcoin existed. In 1944, 44 countries joined the Bretton Woods system, and because of this system and overall confidence in its economy, the United States achieved superpower status in the following decades. India could also see similarly strong growth through Bitcoin adoption. First, India could open the door for anyone to legally invest directly in Bitcoin through banking channels. Just like it did with gold, the RBI could continue to accumulate bitcoin as a national reserve. Since Bitcoin has a fixed supply of 21 million, accumulating Bitcoin earlier than other countries will have a clear advantage in the coming years. These bitcoin reserves will facilitate public capital expenditures and aid the private sector through a series of reforms.
Every time a new investment opportunity knocks on the door of a country, the country has the potential to build an entire ecosystem. The same is true for Bitcoin. It will spawn new entrepreneurs, new start-ups, new businesses, new innovations, new products and services, new consumers and entirely new markets. And it's all happening on the Internet and on smartphones.
This change is also happening with other technologies such as artificial intelligence and the Internet of Things. Blockchain technology and Bitcoin are taking off in countries such as Singapore, Germany and Switzerland. So it makes a lot of sense for Bitcoin to thrive in regulatory environments around the world. This philosophy may run counter to the rebellious roots of some Bitcoin enthusiasts who seek to challenge the current financial system. But let's be realistic. If Bitcoin has to reach 1.3 billion people like India, it can only do so through appreciation, acceptance, and small adjustments.
For an average Indian, allowing them to invest in Bitcoin through regulated channels will help increase their purchasing power. Currently, India's per capita income is just over US$2,000, which is far lower than other developed countries. In addition, ordinary retail investors are not allowed access to open global high-performance markets and are limited to limited options in India's domestic stock and commodity markets. If the Indian government classifies Bitcoin as a commodity/currency, then 1.3 billion people will have the opportunity to use the hardest currency channels to store their wealth, resulting in an increase in overall per capita income over time. What's more, providing the hardest-to-get funding will help maintain basic demand levels during critical times like recessions or economic slowdowns. Even today, there are still 190 million people in India who do not have bank accounts. With the help of Bitcoin, these people can manage money such as savings and transactions.
The chain growth of Bitcoin will lead to multiple Bitcoin companies launching second/third layer solutions. With the liberalization of Bitcoin regulations in India, it will create many important Bitcoin innovations and create a large number of Bitcoin-related jobs in fields such as technical engineering, marketing, etc.
Don't worry about having no confidants on the road ahead, but there are friends on the investment road. I am Nakamoto Curry (BTC6668888), and I am willing to stand with you through thick and thin!
If you want to invest in Bitcoin but haven't found an effective profit method, or you have stockpiled spot but don't know how to use contracts to hedge risks, or you like Nakamoto Curry's humor, welcome to communicate.
Don't worry about having no confidants on the road ahead, but there are friends on the investment road. I am Nakamoto Curry (BTC6668888), and I am willing to stand with you through thick and thin!
market strategy
market strategy
ETH: The trend of Ethereum is not as strong as Bitcoin or not as strong as Bitcoin. In the short-term operation within the day, it is more likely that the current price will fluctuate in a wide range.
risk warning
risk warning
The points involved in the article are for reference only.
Market views are time-sensitive and will be adjusted at any time due to adjustments in disk operations.
