Gen Z Powers Crypto Surge, Mature Investors Lead Market Activity: Report When it comes to the Web3 start-up ecosystem, India has emerged as the 2nd largest developer market and the 3rd largest founder base. The country acts as a base for 11.8 per cent of crypto developers and 5.4 per cent of global Web3 founders.
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Post Donald Trump's presidential campaign win, cryptocurrency has gained momentum, surging close to USD 100,000 for the first time. While India is still evaluating the pros and cons of the digital currency, blockchain has been a constant Web3 trend companies, governments, and other parties are actively exploring and to an extent, adopting.
India's developer prowess is known and widely regarded globally. Having dominated the web2 space for major information and technology companies, Indian developers are now driving innovation across multiple web3 domains.
When it comes to the start-up ecosystem, India has emerged as the 2nd largest developer market and the 3rd largest founder base. India acts as a base for 11.8 per cent of crypto developers and 5.4 per cent of global Web3 founders. These figures were revealed in the 'India's Web3 Landscape 2024' released by Hashed Emergent at the India Blockchain Week 2024.
At present, India is home to prominent projects such as Polygon, CoinSwitch, Biconomy, CoinDCX, Sentient, and Transak to name a few. Notably, India retained its top position leading crypto adoption among 150+ countries in 2024.
Trends, funds, and investor landscape
According to the report, infrastructure, CeFi/DeFi, and consumer have emerged as key focus sectors. Under the three, scaling solutions, artificial intelligence (AI), DePIN, DEXs, RWAs, staking restaking, gaming/NFTs, gaming guilds, and gaming studios have been sectoral trends.
Since 2020, Indian start-ups have obtained funds worth approximately USD three billion with 2022 alone raising USD 1,402 million. For 2024, 50 deals accounted for USD 462 million in the first nine months. The figure was more than that raised in 2020 and 2023 year long, being up by 82 per cent since last year. The funding uptick demonstrates India's robust Web3 ecosystem.
With a figure of over USD 460 million, funds globally have invested in Indian founders with Accel, PeakXV, Lightspeed, Kalaari, and Elevation being active investors in the domestic market.
Demographic trends
The report also highlights that crypto adoption surged in 2024 driven by Gen Z and Millennials with the 27-40 age group dominating new token investments. Notably, 35 per cent of the crypto investor base is Gen Z.
Mature investors were observed to drive engagement as 3x higher per-user investment value was demonstrated by investors in their 40s.
Notably, higher risk tolerance was exhibited by investors aged 40-45, while Gen Z and millennials focused on meme coins and blue chips. There was a 5x increase in growth across meme coin trading volumes relative to other crypto asset categories.
November onwards the crypto investors have rejoiced. The report notes that traders preferred small, frequent trades with medium leverage. About 96 per cent of traders maintained position sizes below USD 12 with 45 per cent trading daily.
Chandigarh and Delhi lead in crypto adoption density among cities, while the North East excels regionally. Notably, NE has emerged as a leader in per capita crypto adoption.
Government adoption
Central and state governments along with large and mid-sized companies in India have actively been embracing blockchain technology across multiple use cases.
On the government front, having been adopted for land registry, digital certification, and supply chain, 84 million records have been created across 20 divisions, six products, and seven states.
The government's bet with CBDC, an alternative to cryptocurrency, has amassed five million users with the help of 16 participating banks.
Developer Insights
India boasts of 4.76 million open-source developers, ranking higher than Brazil, China, Indonesia, Japan, and Mexico. It is expected to surpass the US and have the largest developer community by 2028.
According to the report, 45.3 per cent of Indian crypto developers are engaged in code contributions, while 29.7 per cent and 22.4 per cent are engaged in bug fixes and documentation efforts, respectively.
"Almost 85 per cent of Indian developers are under the age of 27. This is the opportunity. Their skills and experience will shape the future. For all L1s and L2s out there, you cannot miss India," said Sharanya Sahai of Hashed Emergent.
While the lack of a pro-web3 policy agenda and negative regulatory tone, high tax rates, threats of blockchains and VDAs facilitating 'parallel currencies', and limited 'real-world use-cases' perception act as regulatory barriers, enabling sandbox access and establishing accelerators for web3 sector, Web3 regulation and technology framework for cross-border transactions, and enabling ease of banking and fintech access for web3 businesses provide an opportunity for a progressive regulatory framework.
