Shiba Inu becomes the crypto star in India, disrupting local exchange WazirX

WazirX, India’s largest cryptocurrency exchange, which is headquartered in Mumbai, recorded its highest daily trading volume of $562 million between Wednesday and Thursday. Meme-coin Shiba Inu’s volume alone was about $338 million of the total, the company said. Frantic trading in meme-coins has even disrupted the crypto exchange.

WazirX chief executive Nischal Shetty said its price was driven higher by its “hardcore community”. Avinash Shekhar, Co-CEO of ZebPay, that listed the token on its exchange two weeks ago due to high demand from investors, said that the spike in prices by 100% in the last two weeks, is causing more people to get into an asset with its price on the rise.

“The social media buzz and celebrity endorsements are a huge moving factor for meme coins. In addition to that, the cheap price of these coins in comparison to well-known cryptos like Bitcoin or Ethereum also contributes to the interest of the people. FOMOing into an asset that is trending is another big reason that gets more investors to experiment with these coins,” said Shekhar.

The Dogecoin-inspired meme-coin Shiba Inu is the 11th largest cryptocurrency with a market cap of $32 billion. It is listed exclusively on WazirX in India.

This led to disruption on WazirX on Wednesday. Disruption hurts many people as WazirX has more than 9 million users, sources told BusinessLine.

“We are investigating the delays in the WazirX app and website. The team is working on scaling the systems and will update you as soon as it is fixed. Sorry for the inconvenience,” WazirX told its clients in a communication. It also lists scores of other cryptocurrencies on its platform but has not given any reason for the tech disruption.

Crypto exchanges are yet to prove themselves on the technology front, and clients say that sometimes buying and selling on them and money transfers are tedious. Yet, due to the hype of crypto trading, these exchanges now claim to have more traders registered with them than the mainline stock exchanges, like the BSE.

In the last 24 hours, the rally in Shiba Inu was due to three lakh people signing petitions on Change.org to get it listed on Robinhood. Little-known individual Tristan Luke had started the petition to list Shiba Inu on Robinhood and has received more than lakh signatures.

The brokerage app Robinhood Markets Inc has become hugely popular amongst traders betting on speculative stocks and cryptocurrency. Dogecoin was responsible for 61% of crypto-transaction revenue at Robinhood in the second quarter of this year.

In an earnings call, Robinhood’s chief executive Vlad Tenev said the company would remain cautious about adding new coins, especially if they risk raising concerns from regulators as unregistered securities.

Shiba Inu gained prominence in India earlier this year when Vitalik Buterin, cofounder of Ethereum, donated $1 billion worth of Shiba Inu coins to India’s Covid Crypto Relief Fund.

This year, many younger Indians are collecting and gifting virtual tokens during the Diwali festival.

Diwali is when many Indians splurge on gold, both to invest and to gift. Obsessed with the yellow metal even otherwise, buying it around the time of the Hindu festival of lights is deemed particularly auspicious.

The crypto surge, which analysts believe is also a possible result of this new trend among Indians, has taken the cryptocurrency market players by storm.

“We are slowly starting to see a mentality shift in the age group of 25-40 years towards cryptocurrencies,” said Edul Patel, CEO & co-founder of San Francisco-based cryptocurrency platform, Mudrex. “We have noted that people would be interested in being able to give cryptos to their loved ones as a gift during festivals.”