While taking a breather in more recent weeks, the cryptocurrency market has been in bull market mode since now-President Donald Trump’s electoral victory in the November 2024 U.S. Presidential Election.
Around the world, investors of all stripes, from “smart money” professionals to retail traders have increased their economic exposure to Bitcoin and other major cryptos.
Yet while this has already resulted in tremendous gains, especially those early to this latest “Trump trade,” the question now for Indian investors is what the rise of a pro-crypto regulatory regime in the United States means for not just crypto prices, but the future of crypto regulation in India as well.
In a recent interview with Bloomberg TV, Binance CEO Richard Teng gave his outlook on the cryptocurrency markets post Trump election, “The year ended with the election of a pro-crypto president, President Trump, and that gave good optimism into this space. And I predict it’s going to be the start of the golden era of crypto. I think that momentum continues. Last year, we started the year with 170 million users on Binance. We ended the year with 240 million-plus users. So we added 70 million users in the course of the entire year and our institutional users actually more than doubled in the past year. So it’s a fantastic set of results. And this year, by now, we have reached 260 million users globally. So we are the largest global crypto exchange.”
Teng continued by explaining how he believes the new US regulatory stance will affect global markets, “If you look at the past four years under the Biden administration, Operation Choke Point was in progress. So there was a bit of oppression in the US, and US players, global crypto players were facing great uncertainty and governments around the world were not very supportive of crypto. I think we have a fresh reset, restart now. Since President Trump’s election, actually, we have [been approached] by governments all around the world to say, ‘Hey, we want to look at this space now, by virtue of the fact that the US has appointed an AI and crypto czar represents that these are the two most important industries to support all future economies around the world. We are seeing fresh optimism, governments around the world are supporting it.”
Taking a closer look, it’s clear that, below all the hope and hype surrounding Trump in the crypto community, there is substance to the view that the next four years will bode well for the cryptocurrency space, in the U.S., in India, and worldwide.
Bitcoin and Other Major Cryptos Have Surged Higher for A Reason
Although speculative frenzy has perhaps exacerbated the extent in which Bitcoin and other major cryptocurrencies have appreciated in value over the past five months, there is a substantive reasoning behind the global market’s renewed enthusiasm for this asset class.
Upon his election last November, investors anticipated that, following Trump’s January inauguration, his new administration would quickly implement pro-growth, industry-friendly cryptocurrency regulatory policy. So far, the President has lived up to these expectations.
Within days of re-entering the White House, Trump signed into law an executive order considered to represent an ushering in of “regulatory clarity” with regards to crypto. Other crypto-related executive actions, including a recently-signed order authorizing the establishment of a U.S. Bitcoin Strategic Reserve, provides further credence to the notion that the Trump administration will continue to implement a pro-crypto agenda.
Again, while Bitcoin and other major cryptos have been rangebound as of late, following the massive run-up in prices between November and January, the President’s actions could drive an additional wave of bullish sentiment. These actions could also have a positive impact, when it comes to potential changes in India’s cryptocurrency regulatory policies.
What U.S. Policy Changes Mean for India’s Crypto Regulatory Regime
Trump’s sweeping changes to U.S. cryptocurrency regulatory policy have arguably started to drive a global shift in the way major countries regulate and tax this asset class. India is no exception.
In an interview with Reuters published last month, Ajay Seth, India’s Economic Affairs Secretary, noted that in light of changing regulatory stances in the U.S. and elsewhere, the Indian Government is reviewing its own stance on crypto. Between restrictions imposed by the Reserve Bank of India, as well as high taxes on crypto trading, the crypto regulatory regime in India is considered stringent.
Yet while this has not stopped Indians from investing in crypto, both as a means to grow their capital, as well as to hedge against a falling Rupee, relaxation and reform to the country’s current crypto policy could result in a growth surge for the cryptocurrency sector in India.
That’s not all. The implementation of more relaxed policies, which in turn may promote greater cooperation and partnership between Indian and non-Indian decentralized finance (DeFi) service providers. India, despite the current high taxes and restrictive regulations in place, has already become a leader in crypto and blockchain innovation. Thus, a loosening of restrictions could have a tremendous positive impact on the further development of India’s crypto and blockchain industries.
The Bottom Line
While Indian crypto investors stand to benefit from a continued crypto rally, make no mistake. A loosening up of cryptocurrency regulations and taxation likely will not have much of an impact on future crypto prices.
Rather, the U.S.’s changing of its regulatory tune, along with additional factors such as market perceptions about the U.S. dollar, that will likely play a larger role in determining price direction for BTC and other cryptos from here.
However, if countries around the world, including India, take America’s lead, shifting to a more pro-industry, pro-growth stance, the benefits to India could be twofold. First, possible further cryptocurrency price appreciation, in U.S. Dollar and especially Rupee terms, would bode well for Indian investors. Second, reform to India’s regulatory policy, coupled with greater access to the global crypto market, could serve as an accelerant for the growth of India’s blockchain sector.
No VCCircle journalist was involved in the creation/production of this content.
