Last week, the price of Bitcoin in India stood at nearly 40 percent premium to the international price.On Friday, the price of popular crypto-curr
Last week, the price of Bitcoin in India stood at nearly 40 percent premium to the international price.
On Friday, the price of popular crypto-currency Bitcoin hit $774, hitting a 52 week high. The initial surge came after Donald Trump was declared US president-elect, but it is now increasing as a result of China’s decision to put controls on capital flows, including gold importation quotas. Chinese investor saw Bitcoin as a safety net resulting in its price hitting the 52 week high. A similar trend was observed in India after Rs 500 and Rs 1000 Notes were demonetized on 8th November.
Over the past few weeks, the price of Bitcoin in India has been rising faster than international prices. Usually, Bitcoin was quoted at 3 to 5 percent premium to international rates due to the limited supply of the crypto-currency in India. However, Bitcoin was trading at Rs 69,000-70,000 in India last week, an all time high.
These prices equated to nearly 40 percent premium to the international price. According to a CEO of one of India’s Bitcoin exchanges, some profit booking at those very high prices led to a reduction in the premium to the 18 to 20 percent it currently stands at. While the crypto-currency is currently trading at $754 on the international market, prices in India stand at Rs 60,000.
According to EY India Cyber Security partner Jaspreet Singh, the recent demonetization of Rs 500 and Rs 1,000 notes is one of the main reasons behind the increase in Bitcoin popularity in India.
“More people are now looking at Bitcoin as a safe haven at a time when exchanges in the country have stopped accepting cash and traditional avenue such as gold increasingly becoming unavailable,” he said.
The demand for Bitcoin increased further last week when EY announced that its Swiss clients will be allowed to use the crypto-currency to settle the invoices to advisory and auditing services. The firm strengthened the move by installing a Bitcoin ATM at its public offices in Zurich. The ATM is open for anyone looking to exchange Bitcoin for Swiss francs and vice versa. This move is the first time Bitcoin has been acknowledged as a medium to pay for services by an accounting firm.
There are only a few Bitcoin exchanges in India and the mining pool is relatively small, much so compared to china which is considered the biggest Bitcoin trading centre and mining hub. People are however, now forming a mining pool in India to mine Bitcoin. An Indian, Amit Bharadwaj is the man behind Southeast Asia’s biggest mining pool, GBminers.
According to EY India’s Jaspreet Singh, cyber criminal have taken note of the increasing attention Bitcoin has been getting and are now unleashing Bitcoin mining malware. This malware installs illegally on user’s systems and uses computing resources to mine Bitcoin on the criminal’s behalf. So far, cyber criminals have been using social media and malicious downloads to spread the malware.
Bitcoin prices crashed 4 months ago when one for the largest exchanges in china was hacked and large quality of Bitcoin stolen. The attack was not carried out on the mining block chain, but on servers that store wallets where investors store their crypto currency. Cyber security analysts recommend that all Bitcoin be kept in Blockchain accounts. The Blockchain is a publicly accessibly ledge that tracks all Bitcoin transactions.