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I tried to dig a little into how these numbers are being calculated. Most are based on surveys of Indian Internet users, which caters to selection bias of "inte

I tried to dig a little into how these numbers are being calculated. Most are based on surveys of Indian Internet users, which caters to selection bias of "internet users in India who want to earn money using surveys". Additionally, India has a 47% internet penetration, which most reports (citing the surveys) don't seem to be accounting for. The-Ken[c] did a report about how the number of Crypto users in India seems to be over-reported, on two counts - Users have accounts at multiple exchanges (Double Counting) and Users who are in it for the Free Crypto: > Estimates peak at an overly enthusiastic 100 million crypto owners, as claimed by broker discovery and comparison platform BrokerChooser, but the true number is likely a more conservative 10 to 15 million, according to three industry executives The Ken spoke with. > “We work with an internal estimate of about 4 to 5 million regular users in India,” said an executive at crypto exchange ZebPay. [...] Notably, the exchange takes into account not just individuals who made trades in the last 30 days, but also app opens while calculating the number of regular users. > The situation is further exacerbated by exchanges offering joining bonuses and crypto rewards for signing up, like the Rs 100 worth of free bitcoin offered by crypto exchange CoinDCX. > This lures users into creating an account—irrespective of whether they engage with it in the future or not—and helps the exchange pad up its user numbers. A better source to consider is the Reserve Bank of India, which has made 2 interesting statements about the number of crypto investors in India. 1. RBI Governor Shaktikanta Das, Nov 2021: "With a reasonable amount of confidence, I can say the number of investors in the crypto market seems to be exaggerated. Adding that most of the buyers of cryptos in those platforms have anyway invested just between Rs 1,000 and Rs 3,000. (12-36USD). [a] 2. RBI Deputy Governor T Rabi Sankar, Feb 2022: "there is no data to justify how many investors have invested in these instruments and what is the amount of investment. Data informally gathered in November seems to indicate that crypto investments by Indians is nowhere near to being significant (although the pace of growth could make it a concern in future). This data showed that four out of five investor accounts held investments of less than ₹10,000 (122USD), with an average holding size of ₹1,566 (20USD). Wealth loss, if at all it is a possibility, is likely to affect only a small fraction of these investors." [b] I also tried to dig into the original number from Triple-A (Which seems to have gotten a lot of traction because it was quoted in a policy-brief from UN-CTAD[5]) Here's where the number is coming from: 1. Triple-A, Crypto Firm, 2023 Figure[1] is 97.5M / 7.1% of India. The citation for this is their 2022 Report[4] (now deleted). 2. Finder.com, Stats Firm, latest figure is 29% based on a survey of 31k Indians[2]. 29% figure is based on self-selected participants, which are "internet, smartphone and Google AdMob users or Qualtrics research panel participants.". 3. Triple-A, Crypto Firm, 2022 Report[4], claims "over 100 million people, 7.30% of India" and cites HootSuite's Digital 2020 report along with Statista. 4. HootSuite numbers (survey backed), % of Internet Users aged 16 to 64 who own any form of cryptocurrency: 4.1 Digital 2023 - 16.8% [6]. Cites GWI-Q3-2022 4.2 Digital 2022 - 12.6% [7]. Cites GWI-Q3-2021 4.3 Digital 2023 - 7.1% [8] - *this seems to be the figure being used by Triple-A*, which ought to have an upper bound of 2.1% or so (63% of India is aged 15-64, with a 47% internet penetration). Cites GWI=Q3-2019. HootSuite in turn cites GlobalWebIndex, which is again survey backed, and I couldn't find any clarity about the methodology. 5. Statista, Stats Firm, Paywalled[9]. This is again survey backed: "Which of these financial products and investments do you currently use/own? (multi-pick)". The figures shown here concern respondents who selected the option "Cryptocurrency (e.g. Bitcoin)". I found a citation for their 2020 Figure[10], which puts an upper bound on this at 12% or so. [a]: https://bfsi.economictimes.indiatimes.com/news/fintech/numbers-exaggerated-most-indian-crypto-buyers-invested-rs-1000-rs-3000-das/87642507 https://bfsi.economictimes.indiatimes.com/news/fintech/numbe... [b]: https://m.rbi.org.in/scripts/BS_ViewBulletin.aspx?Id=20870 https://m.rbi.org.in/scripts/BS_ViewBulletin.aspx?Id=20870. Highly recommend reading this, as it tackles exactly the argument here ("so many Indians have already invested in cryptocurrencies and banning cryptocurrencies would lead to a loss of wealth for them. There are three reasons such arguments do not appear justified...") [c]: https://the-ken.com/tokenised-edition/the-double-counting-fluff-in-indias-crypto-numbers/ https://the-ken.com/tokenised-edition/the-double-counting-fl... [1]: https://triple-a.io/crypto-ownership-india-2022/ https://triple-a.io/crypto-ownership-india-2022/ [2]: https://www.finder.com/in/finder-cryptocurrency-adoption-index https://www.finder.com/in/finder-cryptocurrency-adoption-ind... [3]: https://bitcoinke.io/wp-content/uploads/2021/10/Geography-of-Cryptocurrency-2021.pdf https://bitcoinke.io/wp-content/uploads/2021/10/Geography-of... [4]: https://archive.is/icGl5 https://archive.is/icGl5 [5]: https://unctad.org/system/files/official-document/presspb2022d8_en.pdf https://unctad.org/system/files/official-document/presspb202... [6]: https://www.slideshare.net/DataReportal/digital-2023-india-february-2023-v01 https://www.slideshare.net/DataReportal/digital-2023-india-f... Slide 48 [7]: https://www.slideshare.net/gangavidya/digital2022indiafebruary2022v01pdf https://www.slideshare.net/gangavidya/digital2022indiafebrua... Slide 47 [8]: https://www.slideshare.net/DataReportal/digital-2020-india-january-2020-v01 https://www.slideshare.net/DataReportal/digital-2020-india-j... Slide 35 [9]: https://www.statista.com/statistics/1202468/global-cryptocurrency-ownership/ https://www.statista.com/statistics/1202468/global-cryptocur... [10]: https://www.mdpi.com/2227-7390/9/24/3263 https://www.mdpi.com/2227-7390/9/24/3263

kipchak 3y ago
Thanks for doing the digging! It seems like whenever a static is dug into there are often a few asterisks necessary. "Lies, damned lies, and statistics" as they say. I wonder why Triple-A wouldn't use the 16.8% figure, which bounded would be 4.97%, other than negligence. the Keynote in [b] is definitely an interesting read though it's a bit unfortunate more statistics regarding holding sizes aren't shared. The perspective expressed of crypto as (reading between the lines) a tool of foreign governments to dollarize EMs is an interesting one. I would be curious if the average person would rather have the individual option of being able to hold other currencies risk and all or if they would prefer to collectively have restrictions for the health of their banking infrastructure as a whole, and how much interest there was in crypto as a means to hold dollars or something else other than rupees, or hoping for extremely high returns in order to then convert back to rupees. "This could be actual dollarization if stablecoins linked to the US Dollar become widely used, and there is good reason to believe that that they would be popular if permitted." "Most cryptocurrencies are owned by businesses of AEs; therefore, better adoption of cryptocurrencies would add to their growth and employment. Significantly, it might be of advantage to the AEs if cryptocurrencies replace emerging market (EM) currencies as that would give AEs a better strategic control on the EMEs." "With one or more private currencies being allowed, there would be parallel currency system(s) in the country. Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy." "They threaten the financial sovereignty of a country and make it susceptible to strategic manipulation by private corporates creating these currencies or Governments that control them." "Almost all cryptocurrencies are priced in terms of Dollars (or potentially any of the freely convertible currencies). Wider adoption would actually result in wider use of these currencies. So cryptocurrencies are not a threat to convertible currencies as they are to the Rupee, which is not an international currency." (I believe the Rupee has since started to be used for international settlements[1]) [1]https://www.isas.nus.edu.sg/papers/indias-foreign-trade-policy-2023-new-ideas-and-old-challenges/ https://www.isas.nus.edu.sg/papers/indias-foreign-trade-poli...

kipchak 3y ago

Thanks for doing the digging! It seems like whenever a static is dug into there are often a few asterisks necessary. "Lies, damned lies, and statistics" as they say. I wonder why Triple-A wouldn't use the 16.8% figure, which bounded would be 4.97%, other than negligence. the Keynote in [b] is definitely an interesting read though it's a bit unfortunate more statistics regarding holding sizes aren't shared. The perspective expressed of crypto as (reading between the lines) a tool of foreign governments to dollarize EMs is an interesting one. I would be curious if the average person would rather have the individual option of being able to hold other currencies risk and all or if they would prefer to collectively have restrictions for the health of their banking infrastructure as a whole, and how much interest there was in crypto as a means to hold dollars or something else other than rupees, or hoping for extremely high returns in order to then convert back to rupees. "This could be actual dollarization if stablecoins linked to the US Dollar become widely used, and there is good reason to believe that that they would be popular if permitted." "Most cryptocurrencies are owned by businesses of AEs; therefore, better adoption of cryptocurrencies would add to their growth and employment. Significantly, it might be of advantage to the AEs if cryptocurrencies replace emerging market (EM) currencies as that would give AEs a better strategic control on the EMEs." "With one or more private currencies being allowed, there would be parallel currency system(s) in the country. Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy." "They threaten the financial sovereignty of a country and make it susceptible to strategic manipulation by private corporates creating these currencies or Governments that control them." "Almost all cryptocurrencies are priced in terms of Dollars (or potentially any of the freely convertible currencies). Wider adoption would actually result in wider use of these currencies. So cryptocurrencies are not a threat to convertible currencies as they are to the Rupee, which is not an international currency." (I believe the Rupee has since started to be used for international settlements[1]) [1]https://www.isas.nus.edu.sg/papers/indias-foreign-trade-policy-2023-new-ideas-and-old-challenges/ https://www.isas.nus.edu.sg/papers/indias-foreign-trade-poli...