Bitcoin seems to be firming its foothold in India, which currently has nearly 50,000 bitcoin enthusiasts with 30,000 actually owning the digital currency. India is one of the fastest growing economies of the world, with a GDP growth forecast around 5.5 percent this year. With a population of 1.25 billion, second only to china, its remittance industry is estimated is over $50 billion. Such figures suggest that the country has the potential to become one of the largest bitcoin markets in the world.



Several bitcoin-based start-ups have already started emerging in the region. One of them, Unocoin, serves more than 20,000 customers, and expects that number to double by the end of this year.



“With such a large portion of India being unbanked, we believe that an open source, decentralized digital currency and payment protocol that is nearly free to use and instantaneous to transfer will have huge positive implications for the country,” says founder and president Sunny Ray, as reported by Redherring.



Another bitcoin exchange BTCXIndia requires all potential users to complete a Know Your Customer (KYC) form upon sign-up, which includes a number of personal and professional information.



Mupparaju Siva Kameswara Rao, founder of BTCXIndia, says that Bitcoins could answer some of India’s economic ills, Redherring reports. However, he says, the RBI “have so far been fairly vague when it comes to any concrete directions for industry. I think what the community is struggling with the most is the lack of clear guidance on the regulatory side, and we hope to get a more detailed legal framework established soon.”



Recently, RBI Deputy Governor Shri R Gandhi spoke at the annual Financial Institution Benchmarking & Calibration (FIBAC) conference in Mumbai and shared his views on cryptocurrencies and crowdfunding. He said these developments are innovative and can assist financial inclusion and therefore, inclusive growth.



However he added, "Digital currencies and crowdfunding have the potential to support criminal, anti-social activities like money laundering, terrorist funding and tax evasion. While we do not have any reported instances of crowdfunding in this respect, cryptocurrencies have been widely suspected to finance criminal activities. We have to be carefully and critically watching these developments".



Events based on the digital currency, such as, "HackCoin Mumbai", a bitcoin-based hackathon, sponsored by Microsoft, IBM, Citruspay and others, are being held in the country. It saw participation of over hundred developers who were seeking to develop blockchain-based applications for payments, big data and digital experience.



With much of India's population underbanked and without any access to basic financial services, bitcoin can go a long way to transform the country’s financial set-up.