Real-life uses of virtual tokens: Gig pay, travel spends in crypto

Most Indians invest in crypto hoping for high returns despite volatility and legal uncertainty. But there are people who go beyond investment and look for other uses of virtual currencies. For instance, gig economy workers are accepting crypto payments from foreign clients and some Indians are spending Bitcoin while travelling abroad. What are the emerging use-cases of crypto? And why do people prefer to use it? Aseem Gujar & Partha Sinha find out…
Buying and selling has been the primary use-case for most types of cryptoholders. The prospect of higher returns compared to conventional assets is a key factor that attracts Indians to cryptocurrencies.
Other investment routes comparable to traditional financial products like ETFs, SIPs and deposits, which this column explained in previous weeks, too have gained in popularity. Then there are some who understand crypto’s underlying distributed ledger (blockchain) technology and have been early adopters to support its development.
But do you wonder what are the other ways crypto is being used despite legal uncertainties? Restrictive regulations globally have been successful in limiting most non-investment use-cases of crypto. Nevertheless, savvy users find ways to benefit from crypto usage in the legal grey zone. What’s common among these types of crypto holders? They invest in & trade virtual assets.
Cheap, Fast Payments
Many Indians ended up owning crypto while freelancing for foreign clients due faster delivery and lower cross-border transaction fees.
“Foreign clients and freelancers both save a lot of fees when transactions are done in crypto instead of wire transfer or alternatives like PayPal,” said Hitesh Malviya, who runs itsblockchain.com, a crypto publication.
Typically, in a cross-border payment, the transaction is verified by both the sender’s and receiver’s banks, which means you can’t get the money instantly. Crypto payments work without intermediaries and rely on the blockchain network to verify transactions.
“Crypto transaction fees are typically a lot less than standard merchant transaction charges because virtual currencies don’t require bank verification for each transaction. Your money usually arrives within a few minutes,” said Micky Irons, chief marketing officer at blockchain platform DeSpace.

Ad Revenue
Online content creators and publishers running small- and mid-sized portals too tend to use crypto to receive their ad money, which are usually low-value transactions.
Itsblockchain.com’s Malviya too said that he has been paid in crypto multiple times in the past six years as client payments for content-creation, and ad placement on his website.
“Established ad networks share much lower revenue than crypto ad networks. Also, the entry barrier to established ones is getting tougher. For these publishers, it is far easier to integrate crypto ad networks and get paid regularly in crypto, however small the amount is,” the moderator of Reddit forum CryptoIndia, which has over 6,000 members, said.
Bitcoin flights, ATMs
The world’s first Bitcoin payment was made to buy pizza in 2010. While you can’t pay for your pizza in crypto in India, you can still book a ticket to Italy with Bitcoin.
“Crypto-savvy Indians have the option of using virtual currencies as a payment method while travelling. With the growing popularity of digital currencies, the number of Bitcoin ATMs has also been rising. However, there’s no data that analyses how Indians are using crypto in the travel and tourism industry yet,” said Darshan Bathija, CEO and co-founder of crypto investment platform Vauld.
Regulator’s Concerns
Apart from the risk of capital loss, which all cryptoholders carry, most of these use cases have been frowned upon by the regulator. The RBI has called for a complete ban on crypto.
In a speech in February, RBI deputy governor T Rabi Sankar had noted that “there are already indications that private cross-border flows are taking place in cryptocurrencies”.
“If this trend is legitimised, part of the flows related to trade payments, personal remittances or cross-border investments would be made in these cryptocurrencies. As they are non-reserve currencies, this could have adverse implications for India’s foreign exchange reserves, which lend stability to the external sector,” Rabi Sankar had said. He had also warned of macroeconomic stability issues as such payments could erode policy control on capital flows.
Legal experts said there are strict reporting requirements for cross-border movements of money. “However, use of crypto, either as payment for services or during foreign travels, will be beyond the current reporting framework,” said L Badri Narayanan, executive partner, Lakshmikumaran & Sridharan Attorneys.
“In respect of services rendered from India, foreign exchange regulations requires realisation of consideration in foreign currencies in India. Receipt of crypto currencies in lieu of foreign currencies will be in violation of forex regulations,” he added.
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