How Bitcoin Will Attempt to Change Cultural Norms in India

By Daniel Zo Bitcoin, India

During the last couple of months, there have been numerous talks on the economic situation over in India, and how Bitcoin could prosper in the region, given the high percentage of citizens who are unbanked.

Events happening in the country may quicken this mass adoption of the digital currency in India, as it is becoming considerably harder for people to rely on cash for their daily transactions. Not long ago, the government if India decided to demonetize the 500 and 1,000 rupee notes, which were worth $7 and $14 in value, and represented roughly 86% of all the cash found in circulation within the country’s borders. The situation is in fact quite bad, as with a population of over 1 billion people, there are only 200,000 ATMs in the country, and 87% of all financial transactions being carried out are made via cash.

India

While this particular move will not cause the country’s economy to crash, citizens throughout the country are crowding up at banks, in order to exchange their worthless notes, into ones which are approved by the country’s government. However, there is a lack of liquidity as well, thus making the process even harder. Such an event can lead people to invest their cash into other assets, such as gold, silver, or of course, bitcoin.

While a higher number of bitcoin investors is definitely good, in India, people often choose to invest in another asset- gold. This precious metal carries an important cultural norm over in India, as the value of each family is often determined by the amount of gold that they possess, in the region. This aspect might have an influence on how quickly the number of bitcoin traders in the regions grows, but there will be a clear spike in transaction volume, and bitcoin investments. However, overcoming a cultural norm is quite difficult for a group of people who are not well-informed about the advantages and disadvantages of banks, but also of holding virtual money, rather than cash.

Sunny Ray, a bitcoin entrepreneur in India, has stated that: “The real impact of this will be long term. The initial growth is mainly because there is a cash crunch. Once the demonetization situation settles down, people aren’t going to rush towards a new experimental currency; they are going to go buy milk. But they will ask themselves, ‘What is money, what makes it good or bad?’. People are starting to learn more about Bitcoin as a result.”

At this moment in time, the damage created by demonetizing the 500 and 1,000 rupee bills cannot be seen, yet the bitcoin scene in the region will surely be emboldened by the continuous fallout of these events.

Based on everything that has been outlined so far, what do you personally think about the future of Bitcoin in India? Let us know your thoughts in the comment section below.