Reaching that milestone will require not only sustained growth but also modern, efficient financial rails. Crypto, deployed judiciously, can contribute to this mission
Every time technology evolves, it surprises us. It quietly reshapes how we live, work, and interact, often in ways we only realise in hindsight. When mobile phones entered Indian homes in the 2000s, few imagined they would one day replace wallets. When UPI was launched, no one thought it would become the backbone of India’s digital payment revolution. Today, a similar shift is beginning this time with crypto and blockchain.
India’s macro-backdrop is compelling. The nation has just crossed the USD 4 trillion GDP mark, making it the fourth-largest economy in the world, according to IMF data. And the government’s “Viksit Bharat @ 2047” vision articulated by Prime Minister Shri Narendra Modi sets a clear target: India as a fully developed economy by the centenary of Independence.
Reaching that milestone will require not only sustained growth but also modern, efficient financial rails. Crypto, deployed judiciously, can contribute to this mission.
Crypto’s First Leg: An Asset Class
Millions of Indians have explored digital assets as part of their diversified portfolios. Exchanges have made access to crypto simple, compliant, and secure. Education is growing. But crypto’s longer-term promise lies not just in investment, it lies in infrastructure.
Over the next two decades, crypto and blockchain technologies could become invisible yet critical components of India’s financial ecosystem, working quietly in the background to power faster, cheaper, and more transparent systems. Much like how the internet runs behind every app or how UPI sits beneath every tap-and-pay moment, crypto infrastructure could eventually support financial efficiency, especially where today’s systems face bottlenecks.
Building on What Works
India’s financial innovation has always been built with scale and inclusion in mind. From Jan Dhan accounts to Aadhaar, from UPI to ONDC, every layer has enabled broader participation while maintaining regulatory oversight. Crypto, if thoughtfully integrated, could support this momentum, especially in areas where inefficiencies persist.
Take remittances. India is the world’s largest recipient of inbound remittances, over $130 billion annually. Yet, fees remain high, and transfers can take days to settle. Crypto-powered remittance rails, particularly using regulated stablecoins, can reduce costs to under 1% and enable near-instant transfers, without bypassing existing banking infrastructure. Licensed banks and fintechs could plug into blockchain rails for settlement while continuing to manage KYC, AML, and regulatory obligations.
Countries like the Philippines are already seeing success with such models. In Singapore, government-led initiatives like Project Ubin and TradeTrust have shown how permissioned blockchains can digitise trade finance and logistics, improving transparency while reducing paperwork and fraud. India can take cues from these experiments to strengthen its cross-border flows, especially in exports and diaspora engagement.
For the Public: Micro Use Cases, Big Impact
Beyond global flows, crypto infrastructure could help everyday Indians. Micro-lending, for example, often struggles with verification and high operational costs. With blockchain, borrowers can build portable, verifiable financial identities. Smart contracts could automate loan disbursements based on weather data, crop cycles, or local market conditions. Similarly, repayments could be structured into digital wallets, improving efficiency and reducing defaults.
Programmability with digital assets is an important feature that could be used for targeted welfare programs resulting in efficient delivery, elimination of misuse and data for further improvement.
Insurance is another area with potential. Parametric insurance — where payouts are triggered automatically by real-world data (such as rainfall or temperature) — can reduce delays in claims.
None of this requires replacing existing systems. It only requires strengthening them.
For Institutions: Building with Stability
In parallel, banks and financial institutions are already exploring how blockchain can improve backend processes. Stablecoins — digital tokens backed 1:1 with fiat currency, most likely will be used for real-time settlement, particularly in institutional flows, reducing counterparty risk and improving capital efficiency. Over time, programmable money may allow for better cash management, automated interest payments, and compliance enforcement, all built into code.
These applications can be designed within permissioned, compliant environments, aligned with India’s regulatory and monetary frameworks.
Policy – Progress Made, Ground to Cover
India’s regulators have moved from scepticism to structured engagement. Clear rules now exist for taxation, AML/KYC, and advertising disclosures. During its 2023 G20 presidency, India helped deliver the FSB-IMF synthesis on global crypto standards, and the upcoming Crypto-Asset Reporting Framework (CARF) will enhance cross-border transparency from 2026.
There is still considerable scope for bringing in further guidelines on prudential norms, consumer protection, cybersecurity, among others. Other regions are moving fast: the EU’s MiCA, the UK’s consultation papers, the UAE’s VARA framework, and growing bipartisan support in the US all point to a competitive regulatory landscape. If India wishes to remain a technology leader and meet its 2047 vision, it must keep pace.
Planting Seeds for 2047
Looking 25 years ahead to 2050, it is almost impossible to imagine the scale of India’s technological advancement. But if we truly aim to be among the most developed nations, now is the time to invest in the foundations. History tells us that those who seed innovation early reap disproportionate benefits later, just as the U.S. established internet dominance by funding ARPANET in the 1960s and began AI R&D in the 1980s, now powering a $300 billion AI economy.
India must act with similar foresight. The Standing Committee on Finance should actively consult with stakeholders on the crypto assets regulatory roadmap and the Inter-ministerial group, which was constituted post G20 outcome, should actively interact with the industry representatives similar to how FinTech IMG is constituted.
Regulated stablecoin pilots for remittances and trade can be launched within controlled sandboxes. Tokenisation trials for public infrastructure and government bonds should be encouraged to widen participation. And Aadhaar-linked, privacy-preserving digital identity standards must be aligned to power Web3 adoption safely.
