India's rich are swapping gold for bitcoin. Here's Why

India Today

3 days ago

For generations, gold has been the crown jewel of wealth for Indian families. From family vaults to wedding gifts, it has symbolised trust, security, and cultural pride. But times are changing, and so is how the wealthy manage their fortunes.Today, a quiet but noticeable shift is happening. More of India's rich are putting a slice of their gold-backed wealth into shiny new digital coins like Bitcoin.advertisementWHAT'S DRIVING THE SHIFT?So, what's fuelling this move away from the familiar yellow metal to a digital asset that didn't even exist two decades ago?
According to Edul Patel, CEO and Co-Founder of Mudrex, 'Since the US elections last year, interest in crypto has gone up globally, boosting overall confidence. In India, more HNIs and family offices are starting to add crypto to their portfolios — mainly for diversification and as a hedge.''At Mudrex, about 30% of our volumes now come from this group. They usually invest 2–5% in digital assets like Bitcoin, Ethereum, and Solana, these three alone make up nearly 70% of those investments,' he added.BITCOIN'S GROWING APPEALWhat makes Bitcoin stand out? Its biggest pull today is rising institutional interest and clearer rules. As the crypto market matures, Bitcoin's wild price swings are also settling down cycle by cycle, making it more attractive for the long haul.Sumit Gupta, co-founder of CoinDCX, explains, 'The mindset among wealthy Indian investors is changing, from asking why they should invest in crypto, to how much they should allocate to it in a well-diversified portfolio.'He says trust is growing thanks to big global names like BlackRock launching Bitcoin ETFs. 'Moves like this send a strong signal that Bitcoin is no longer just for tech geeks, it's becoming part of mainstream finance,' Gupta adds.BALANCING RISK AND REWARDOf course, Bitcoin's journey is far from risk-free. India's wealthy know this. So how do they balance Bitcoin's promise of high returns with its reputation for big swings?Patel says the wealthy treat crypto with measured caution. 'We typically see them allocating no more than 2–5% of their portfolios to digital assets, which reflects a clear understanding of the inherent risks and volatility. This conservative allocation allows them to tap into the potential upside of crypto while maintaining overall portfolio stability,' it noted.CoinDCX's Gupta draws a parallel with the early internet boom. 'Investors are selective, focusing on high-conviction assets like Bitcoin, Ethereum, and key Layer 1s, where fundamentals are becoming clearer and institutional interest is deepening.' Many also bring in trusted advisors and build special teams inside family offices to handle crypto safely, he added.advertisementHimanshu Maradiya, Founder and Chairman of CIFDAQ, says Bitcoin's eye-catching returns are hard to ignore. 'Bitcoin's outsized returns, nearly 70% CAGR over a decade, are drawing HNIs seeking higher growth than gold's conservative 6–8%.''They treat crypto as a high-risk, high-reward slice (5–8%) of their portfolio. Exposure is managed through family offices, professional fund managers, long-term horizons, and diversification across Bitcoin, Ethereum, stablecoins, and Web3 startups. Secure custody and regulated platforms reduce operational risk,' he added.THE NEXT-GEN PUSHSo, who's sparking these crypto conversations at India's lavish dinner tables? It's the next generation.Patel points out that next-gen heirs are often the first to raise the idea. 'Being more tech-savvy and open to new asset classes, they're often the ones initiating conversations around crypto,' it said.Maradiya added, 'Next-gen heirs are driving digital diversification. They influence family office strategies, push for crypto and other digital assets, and are even embedding them into succession and estate planning.'OLD GOLD, NEW COINSOf course, Bitcoin isn't risk-free. Maradiya warns that its price can swing wildly, its yearly ups and downs are four times bigger than gold's. Plus, there's India's flat 30% tax on crypto gains and a 1% TDS, which can eat into profits. HNIs are tackling this with careful position sizing, secure storage, and professional help to avoid hacks or mistakes.advertisementThe experts believe it won't replace gold but will sit next to it. Patel believes Bitcoin will become a bigger part of India's wealth plans in the next five years, as better rules and digital infrastructure take shape.'As regulatory clarity improves and digital infrastructure matures, we anticipate a significant rise in allocations toward Bitcoin, especially among younger HNIs and progressive family offices who see it as digital gold for the 21st century,' he explained.Gupta agrees gold's emotional and cultural value is unmatched in India, but Bitcoin brings something new: digital, scarce, and borderless. 'It's not about replacing gold, but about diversifying beyond it,' he says.Maradiya sees Bitcoin forming 5–10% of HNI portfolios in the coming decade, fuelled by younger investors and new offerings like Bitcoin ETFs.In the end, gold and Bitcoin are unlikely rivals, they're becoming partners. One is timeless, the other is cutting-edge. Together, they show how India's wealthy are blending old and new to shape the future of wealth, one coin at a time.- Ends
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