India And NFTs: The Cataclysmic Potential.
You may have a hundred rupee note in your pocket right now. I have one in my wallet right now. The note that I have is worth exactly the same as yours.
In other words, you can say that our two denominations of currency are interchangeable.
Cryptocurrencies, now they too, are interchangeable. At any given time, the bitcoin owned by a businessman in Dubai is worth exactly the same as the bitcoin owned by a politician in France.
Cryptocurrencies, therefore, are also interchangeable. However, imagine a world where every dollar note, every rupee note, and every pound sterling, is unique, bespoke, customized, and most importantly, differentiable.
That in a nutshell is what an NFT is — a Non-Fungible Token. Each NFT is worth a certain amount of money when it is “minted” (created), and that amount can appreciate or even depreciate, based on supply and demand.
Another important distinction between a Non-Fungible Token and the cryptocurrency on which it is blocked is that each NFT is unique to itself. This is not a hard and fast rule but if each NFT is not unique and bespoke, it kind of defeats the purpose of creating an NFT in the first place.
India is extremely well-positioned to become a giant in the NFT space and she might even emerge as a global leader in the industry as a whole.
This is despite the government and Reserve Bank Of India’s crackdown on gains on cryptocurrency in the new financial budget (more on legal implications of owning one of these tokens in India later on in the article).
What Is The Current Market In India Like?
India is currently third on the global scale in terms of sheer numbers, being home to a record eleven companies solely dedicated to NFTs.
This places India behind only the United States Of America and Singapore in terms of the total numbers, but volume is another question entirely.
The NFT market in the country is, just like the cryptocurrency market in the subcontinent, almost entirely untapped.
In other words, the fruit is ripe for the taking. According to reports by KnockSense and MarketDecipher, India currently accounts for 5.02% of all NFT sales and purchases globally.
The simple law of supply and demand dictates that where there is an asinine[1] demand for an item, and very few providers, the profit margins will, no doubt, be going to the moon.
Why Is The Market Underutilized?
Let’s get one thing clear from the get-go: India was one of the fastest adopters of cryptocurrency for a growing space.
But did I not just say the market was underutilized?
Yes, people in India were quick to adopt crypto as an asset and investment, but despite it proving a useful tool in one’s portfolio, even owning a Bored Yacht Ape will not bring you any impressed eyebrow raises in India.
This is because a still-developing country like India hadn’t yet understood the value that non-fungible currencies can have. Imagine “buying” a one-hundred rupee note for one hundred and twenty rupees, and then having that note be worth five hundred rupees in a year’s time.
However, the populace did not want to have to contend with the possibility of that one-hundred-and-twenty rupee note being devalued to, say, ninety rupees.
In a country where the majority of the population still prefers traditional, safe investments such as gold and land, the power of non-fungible currencies is probably as alien to them as fiat currency (currency not linked to gold) was to the people in the sixties when the abolition of the gold standard came about.
Do Non-Fungible Tokens Have A Future In India?
One word: absolutely.
Last year alone, more than three and a half million NFT-related keyword searches flowed through Google, from India alone.
NFTs have carved out a niche for themselves in the world as being a creator’s best friend. In India too, creatives are looking to NFTs as they want to go beyond paid partnerships, brand advertisements, and chargeable segues.
However, leaders in the industry are mostly of the opinion that story-based tokens do not have a future in the country, but application-based tokens are soaring.
Is There Scope For Innovation With NFTs In India?
There is scope for innovation with NFTs everywhere, but especially in growing markets such as India. After all, in a country of a billion plus people, there are bound to be some good ideas emerging.
One such example is Vishal Mehrotra — a popular TV actor who is making a movie that is funded purely from the sale of his NFTs.
The opening price of Mr. Mehrotra’s NFT was about 1.5 eth (Ethereum) but they now frequently cross 20 eth, which at the time was about USD 15,000, give or take.
South Asia also ranks as the biggest market for Nike’s shoe NFT sales, with the idea that each NFT from the company should be tradeable for the shoe it represents.
NFTs and The Indian Legal System
As of the date of publication of this article, NFTs have not come under the radar of the RBI or any group that represents the Indian Penal Code.
That means that, thus far, NFTs have the green light to go speeding ahead in the country, and every fact points towards just that happening.
The future for cryptocurrencies is a bit ambiguous as there is now a thirty percent tax on all crypto gains and a one percent tax on all intraday trades.
However, NFTs are in the gray area of cryptocurrencies as they are non-fungible, thus they do not have that anonymity that cryptocurrencies enjoy, which is why many believe that it is a safe bet that NFTs are the better alternative to crypto, given all these governmental restrictions.
What’s The Future?
Isn’t it obvious? NFTs are.
They are tradeable, they hold value, if you invest prudently, they will appreciate in value, and they provide a foolproof, solid workaround to the anti-crypto sentiments in the country.
They have immense potential, and you heard it here first — Indian NFTs are about to boom.
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