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Indian Bitcoin Enthusiasts Pay US$125 Premium Buy Cryptocurrency

Avatar newsbtc 3 years ago

The Bitcoin price is spiking in India as we speak. UnoCoin, one of the country’s leading cryptocurrency exchanges, marks the price at RS 59,148. That is well above the current US value per Bitcoin, indicating the demand for alternative financial solutions is huge in India right now. But is this a sign of things to come, or just a temporary price boost?

Ever since the vast majority of cash in India was suddenly declared “illegal”, the country has been a mess. Financial turmoil is affecting everyone, and capital outflows are becoming more prevalent. Interestingly enough, a lot of people are flocking to Bitcoin as a way to hedge against future financial instability.

Indian Bitcoin Buyers Pay A Hefty Premium

As demand for Bitcoin grows, so will the price per BTC in India. In fact, UnoCoin reported some trades worth US$871, which is well above the current US$746 price on other exchanges. Providing enough liquidity to accommodate this demand will be a key challenge fort any cryptocurrency exchange in the country, though.

While some people may see this as an arbitrage opportunity, it is not that simple. Anyone can create an account at UnoCoin and fund it with Bitcoin to sell against the Rupee. But converting that funds back to EUR, USD, or any other currency will be very tricky. Moreover, the Rupee is plummeting in value, making it far less attractive to hold than ever before.

It is not uncommon for investors, traders, and consumers to pay premium rates when buying Bitcoin. Chinese traders, who represent roughly 95% of all daily Bitcoin trading volume, usually pay 5-10% more than the average price. Then again, 5-10% is still a lot less than a whopping US$125 premium.

For now, it remains unclear if this price trend will continue across Indian Bitcoin exchanges. Our technical analysis is always a great tool to keep an eye on how things are expected to evolve in the next 24 hours. Arbitrage opportunities will remain for those who can take advantage of them, though.

It has been a good week for Bitcoin so far. With prices increasing across the world, the demand for cryptocurrency is increasing. However, with its limited supply, liquidity could become an issue. That would be a positive problem, though, as it will drive up prices even further.

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