With a rebound in the cryptocurrency market and Bitcoin hitting record highs, Uday Kotak on Wednesday said the future competition for equity markets could be coming from the digital currency.
“Capital formation in India has a lot to do with development and regulation of local markets. Having seen a revolution in local markets from badla systems to futures and options (F&O), the future competition could be in the form of cryptos,” said the veteran banker.
Kotak further noted that developed nations legitimising the virtual currency and its trading further adds fuel to the crypto bandwagon and investors are looking at it as a hedge for other investments.
After months of turbulence, Bitcoin, the world’s largest cryptocurrency, has gained momentum in the past few days and raced to an all-time peak above $72,000.
The most popular cryptocurrency won further support on greater trading accessibility and dollar weakness.
The record spurt extended last week’s run when the currency bulldozed its way past the previous November 2021 pinnacle of $68,991.
Bitcoin won further support on Monday after the UK’s Financial Conduct Authority watchdog said it would join US regulators by allowing the creation of crypto-related securities.
US authorities earlier this year gave the green light to exchange-traded funds (ETFs) linked to Bitcoin’s spot price, making it easier for mainstream investors to add the unit to their portfolio.
ETFs are widely regarded by commentators as proof of burgeoning crypto interest from institutional investors, further buoying investor enthusiasm.
Bitcoin is created — or “mined” — as a reward when powerful computers solve complex problems to validate transactions made on the blockchain.
At its current price, Bitcoin has soared almost 70% since January, when it stood at about $43,000. It slumped to $15,000 in November 2022 following the collapse of crypto exchange FTX.
The digital currency has a finite number of units. Bitcoin’s creator Satoshi Nakamoto has limited the maximum number of Bitcoins to 21 million.
