India’s contribution to the global Web3 ecosystem — primarily in software development, gaming, investments and startup funding — increased year-on-year despite an absence of locally tailored crypto regulations.
India’s share of global Web3 developers grew from 5% to 12% in the last 10 years, second only to the United States as of 2024, according to the India Web3 Landscape Report 2024 by Hashed Emergent, shared with Cointelegraph.
Developer growth in India since 2015. Source: Hashed Emergent
Speaking to Cointelegraph, Tak Lee, CEO and Managing Partner at Hashed Emergent, pointed out four key factors driving India to the top of global crypto adoption: retail crypto transactions on centralized services, highest trading volumes, institutional adoption and retail DeFi transactions.
Gen Z dominates the Web3 developer landscape in India
The growth is driven by the younger generation, as roughly 80% of all blockchain developers in India are between 18 and 27 years of age. The Indian developers in DeFi, Payments, AI and SocialFi prefer Solana as the go-to blockchain.
Ton, Aptos and Base are steadily gaining momentum across other key sectors, driven by the expanding presence of layer-1 and layer-2 ecosystems, the report noted.
Web3 sector and ecosystem trends in India. Source: Hashed Emergent
While funding opportunities and builder initiatives like hackathons support initial growth, Indian developers have pointed out employers’ lack of willingness to pay salaries that match global industry standards.
The challenges faced by Web3 gaming projects are the extremely high cost of customer acquisition (CAC) to onboard Web3 users and the lack of quality gameplay beyond financial incentives to retain Web2 gamers. “Therefore, several of these games are now focusing on having great quality games before integrating blockchain mechanics or tapping into Indian gamers’ craze for RMG,” Lee explained.
In contrast, investments into the Indian Web3 landscape saw a 224% increase in 2024 compared to the previous year — sourced from various avenues such as local funds, ecosystem funds and corporate venture arms of leading exchanges.
Lee told Cointelegraph that the lack of growth capital in the Web3 world, along with the absence of traditional venture/growth/private equity funds, makes it difficult for Indian firms to raise capital, adding:
“Therefore, entrepreneurs explore crowd sales as a way to fund their future growth. Some renowned projects may also explore crowd sales due to higher valuations offered but this is extremely rare and done by the extremely blue chip founders who can raise money from retail with ample certainty and high volumes.”
Funding in India’s Web3 finance sector. Source: Hashed Emergent
Compared to the previous years, the substantial growth in Web3 investments in 2024 “signals a gradual recovery, with investors focusing on emerging areas of decentralized finance,” the report said.
India is a global hub for founders and developers, currently home to the second-largest developer market and third-largest founder base globally.
Some of the main barriers preventing large-scale investments, according to Tak, have to do with the “slower than anticipated growth of some of these startups .“ Unclear regulations and compliances also hinder Web3 investments in India.
Growing Web3 against all odds
Despite an active high-tax environment on cryptocurrency, small-scale crypto investments saw an uptick in India. Traders generally preferred small, frequent trades, with 96% maintaining positions less than $12 with an average of 11x-20x leverage. Females represented 1 in 10 futures traders in India, highlighting the scope for greater participation.
The report called for reforms in crypto tax deductions and reporting in addition to the need for federal guidance and tax implications:
“India must overcome its negative policy perception that stifles innovation and instead focus on identifying and addressing the pain points faced by stakeholders with effective regulation that will incentivize the Web3 sector to grow and thrive.”
Indian Web3 firms call for progressive regulation for all stakeholders. Source: Hashed Emergent
The policy wish list for the Indian Web3 includes the regulatory framework for virtual asset service providers (VASP), tax rationalization, streamlined banking and payment access for Web3 companies, exemptions from VASP regulations and clarity on existing regulations.
Recent regulatory initiatives like URL blocking of locally unlicensed crypto exchanges have resulted in the influx of funds to self-custodial solutions (decentralized exchanges) or domestic exchanges, which are regulated under Indian law.
The chief inspector of prisons has said the recent spate of prisoners being released too early is “a symptom of a system that is close to breaking point”.
Charlie Taylor’s assessment comes as it is revealed that two prisoners wrongly released last year are still at large, as are two others believed to have been freed in error in June this year.
Writing in The Daily Telegraph, Mr Taylor said the growing number of mistaken early releases was “embarrassing and potentially dangerous”.
He also put it down to “an overcomplicated sentencing framework” and described it as “a symptom of a system that is close to breaking point”.
Image: Sky’s Tom Parmenter confronts Brahim Kaddour-Cherifm, who was arrested on Friday after a police search following his release from HMP Wandsworth in south London last week
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In full: Moment sex offender arrested
He said prison inspections “repeatedly highlight the failure to keep prisons secure, safe and decent, and to provide the sort of activity that will help inmates get work on release”.
In his opinion piece, the chief inspector pointed to successive governments’ responses to the overcrowding crisis in the system, which put pressure on “junior prison staff who repeatedly had to recalculate every prisoner’s release date”.
These calculations, he wrote, had been made harder by a series of early-release schemes brought in by successive governments.
The changes, he said, “increase the likelihood of mistakes and in three years the number of releases in error has gone up from around 50 a year to 262”.
It comes as ministers face mounting pressure over a series of high-profile manhunts, with Justice Secretary David Lammy admitting on Friday there is a “mountain to climb” to tackle the crisis in the prison system.
Algerian sex offender Brahim Kaddour-Cherif, 24, was arrested on Friday after a police search following his release from HMP Wandsworth in south London last week, which Scotland Yard said officers only found out about on Tuesday.
It follows the mistaken release of Hadush Kebatu, who was convicted of sexually assaulting a 14-year-old girl and a woman while living in an asylum hotel. The incidents sparked protests in Epping, Essex.
Prison security checks have been toughened and an independent investigation into mistaken releases launched after the now-deported Ethiopian national was accidentally freed from HMP Chelmsford on 24 October.
Image: Hadush Kebatu was convicted of sexually assaulting a 14-year-old girl and another woman. Pic: Crown Prosecution Service/PA
A total of 262 inmates were mistakenly let out in the year to March 2025 – a 128% increase on the 115 in the previous 12 months, according to the latest official figures.
Of the total, 90 releases in error were of violent or sex offenders.
Kaddour-Cherif was serving a sentence for trespass with intent to steal, but had previously been convicted for indecent exposure.
He is understood to have overstayed his visitor’s visa to the UK after arriving in 2019, and was in the process of being deported.
Asked about the four missing prisoners on Friday, shadow justice secretary Robert Jenrick said: “The chaos continues. The government keeps putting the British people at risk and is relentlessly failing victims. Does anyone have confidence in David Lammy?”
Mr Lammy said on Friday: “We inherited a prison system in crisis, and I’m appalled at the rate of releases in error this is causing.
“I’m determined to grip this problem, but there is a mountain to climb which cannot be done overnight.
A Ministry of Justice spokesperson said releases in error “have been increasing for several years and are another symptom of a justice system crisis inherited by this government”.
In a statement on Saturday, the ministry said it has introduced “mandatory, stronger prisoner release checks to keep our streets safe and protect the public as well as investing record amounts into our courts – including to improve operational assurance.
“We’re also investing billions, reforming sentencing and building the prison places needed to keep the public safe.”
Faruk Fatih Özer was found dead in his prison cell on Nov. 1. The former CEO of now-defunct crypto exchange Thodex was serving an 11,000-year sentence for running one of the largest crypto scams in history.
His death marks the latest turn in the Thodex saga, with ripple effects so significant they altered Turkish cryptocurrency laws.
The initial details of Özer’s death point to suicide, but the investigation is still ongoing. It has once more brought Thodex back into the spotlight.
Here’s a look back at Özer’s story, how the crypto exchange impacted Turkish law and how it may have contributed to the country’s increased crypto adoption.
$2-billion Thodex scam sees raids, arrest and CEO out on the lam
On April 21, 2021, Thodex cryptocurrency exchange suddenly shut down trading and withdrawals. The initial announcement read that this could continue for four to five days. As Cointelegraph Turkey reported at the time, the exchange claimed that this was to improve its operations with the help of “world-renowned banks and funding companies.”
But local media reported that Özer had fled to Thailand with over $2 billion in funds as part of an exit scam. There were also reports that police had raided the exchange’s offices in Istanbul.
Istanbul’s chief prosecutor’s office corroborated the reports the following day. It announced a probe into Thodex and said police had arrested 62 people allegedly involved in the scam. Özer denied the accusations, claiming his trip abroad was to meet foreign investors.
As of April 30, 2021, a Turkish court decided to jail six suspects, including family members of the missing CEO and senior company employees, pending trial. Interpol also issued a red notice for Özer.
“When he is caught with the red notice, we have extradition agreements with a large part of these countries. God willing he will be caught and he will be returned,” said Interior Minister Süleyman Soylu.
Özer managed to evade capture for over a year. Albanian authorities eventually detained him on Aug. 30, 2022. He attempted to appeal extradition in court, but the decision was upheld, and Özer was in Turkish custody by April 30, 2023, two years after the scandal began.
Özer was detained by Turkish authorities after being extradited from Albania. Source: AA
The case against Özer was swift. In July 2023, just three months after arriving in Turkey, he was sentenced to seven months and 15 days in prison for failing to submit certain documents requested by the Tax Inspection Board during the trial.
In court, Özer claimed that he and his family were facing false accusations. He said, “I am smart enough to manage all institutions in the world. This is evident from the company I founded at the age of 22. If I were to establish a criminal organization, I would not act so amateurishly. … It is clear that the suspects in the file have been victims for more than 2 years.”
Özer was serving his sentence at the Tekirdağ No. 1 F-Type High Security Closed Penal Institution when he died. F-Type prisons are high-security institutions reserved for political prisoners, members of organized crime syndicates and other armed groups serving an aggravated life sentence.
Human rights advocates have repeatedly raised concerns about the conditions at F-Type prisons. In 2007, Amnesty International noted “harsh and arbitrary” disciplinary treatments, as well as isolation.
Turkey changes its laws to protect investors
The Thomex scandal and its ensuing fallout were so significant that they drove the Turkish government to change its policies toward cryptocurrencies.
Immediately following news of Özer fleeing the country, the Central Bank of the Republic of Turkey banned crypto payments and prohibited payment providers from offering fiat on-ramps for crypto exchanges. The official notice outlawed “any direct or indirect usage of crypto assets in payment services and electronic money issuance.” Notably, the ban excluded banks, meaning that users can still deposit lira onto crypto exchange accounts using bank transfers.
The ban aimed to ensure financial stability, while other agencies like the Capital Markets Board (CMB) and the Financial Crimes Investigation Board (MASAK) moved to legitimize trading activities. In May 2021, MASAK amended money laundering and terrorism financing laws to include provisions for cryptocurrency.
By 2024, the “Law on Amendments to the Capital Markets Law” came into effect. This built on the initial changes in 2021, which included extensive consumer protection measures in addition to provisions on licensing and reporting.
These new measures, which also aimed to move Turkey off the Financial Action Task Force’s “gray list” of countries with inadequate Anti-Money Laundering measures, have in turn helped spur the local crypto industry.
Chainalysis’ “2025 Geography of Crypto Report” found that Turkey led the Middle East and North Africa in value received in crypto. Trading activity also spiked last year.
In the long term, the Thodex scandal may have led to increased crypto adoption in the country, but only after it rocked the Turkish crypto industry and left many investors out to dry. It also resulted in the imprisonment and death of its orchestrator and CEO.
A New York jury was unable to reach a verdict in the case of Anton and James Peraire-Bueno, the MIT-educated brothers accused of fraud and money laundering related to a 2023 exploit of the Ethereum blockchain that resulted in the removal of $25 million in digital assets.
In a Friday ruling, US District Judge Jessica Clarke declared a mistrial in the case after jurors failed to agree on whether to convict or acquit the brothers, Inner City Press reported.
The decision came after a three-week trial in Manhattan federal court, resulting in differing theories from prosecutors and the defense regarding the Peraire-Buenos’ alleged actions involving maximal extractable value (MEV) bots.
A MEV attack occurs when traders or validators exploit transaction ordering on a blockchain for profit. Using automated MEV bots, they front-run or sandwich other trades by paying higher fees for priority.
In the brothers’ case, they allegedly used MEV bots to “trick” users into trades. The exploit, though planned by the two for months, reportedly took just 12 seconds to net the pair $25 million.
In closing arguments to the jury this week, prosecutors argued that the brothers “tricked” and “defrauded” users by engaging in a “bait and switch” scheme, allowing them to extract about $25 million in crypto. They cited evidence suggesting that the two plotted their moves for months and researched potential consequences of their actions.
“Ladies and gentlemen, bait and switch is not a trading strategy,” said prosecutors on Tuesday, according to Inner City Press. “It is fraud. It is cheating. It is rigging the system. They pretended to be a legitimate MEV-Boost validator.”
In contrast, defense lawyers for the Peraire-Buenos pushed back against the US government’s theory of the two pretending to be “honest validators” to extract the funds, though the court ultimately allowed the argument to be presented to the jury.
“This is like stealing a base in baseball,” said the defense team on Tuesday. “If there’s no fraud, there’s no conspiracy, there’s no money laundering.”
What’s at stake for the crypto industry following the verdict?
Though the case ended without a verdict, the mistrial has left the crypto industry divided, with many observers debating the legal and technical implications of treating MEV-related activity as a potential criminal offense. Crypto advocacy organization Coin Center filed an amicus brief on Monday after opposition from prosecutors.
“I don’t think what’s in the indictment constitutes wire fraud,” said Carl Volz, a partner at law firm Gunnercooke, in a Monday op-ed for DLNews. “A jury could conclude differently, but if it does, it’ll be because the brothers googled stupidly and talked too much, for too long, with the wrong people.”