Add Crypto to IndiaStack

How does an Indian small business owner get a loan from somewhere in the middle?

Well, today he’s increasingly likely to have a phone, a Reliance Jio connection, and access to IndiaStack: a miraculous set of national APIs for payments, identity, and more that make it easy for him to connect with anyone in India. Can transact from This software platform is a natural entry point for the Reserve Bank of India’s recently proposed digital rupee, which will further accelerate trade within India.


But there is one key piece that is still missing, which is relatively easy access to the economy outside India. Finally, that small business owner can now use their phone not only to make domestic phone calls, but also for international calls. So shouldn’t he be able to get funds from around the world as easily as he can now trade with other Indians?

Crypto makes it possible. As we will show, adding crypto functionality to the India stack alongside the digital rupee serves India’s interests in two distinct ways.

First, it helps Indians domestically, by giving them direct access to both the Indian and international pools of capital.
Second, it helps India internationally by developing an open-source software stack that any country can use for both domestic and foreign transactions, without relying on American or Chinese corporations.

It is a vision of a national software stack and neutral crypto protocol. Put another way, by adding both digital rupee and cryptocurrency support to the India stack, the country will run (a) a permissioned ledger for domestic transactions through the digital rupee and (b) a decentralized ledger for international transactions. will use

This would give India the best of both worlds: a domestic digital currency that is fully controlled by the Reserve Bank of India (RBI), and the ability to make international payments that are controlled by another country at the currency or platform level. There is no control. The digital rupee platform will become the platform of digital gold, digital wallets and decentralized finance. In our era’s debate, it’s blockchain and cryptocurrency, either/or.

In this section, we begin by reviewing India Stake and Crypto, with a special focus on decentralized finance. We then describe the simplest way to add both digital rupee and crypto protocol support to the India stack, and illustrate how a crypto India stack can help India at home through a series of case studies.

Perhaps the most important of these case studies is extended in a companion piece to this article by iSPIRT, the team behind India Stack. It explains how adding crypto support to the India stack will help the RBI bridge India’s MSME financing gap by attracting hundreds of billions of dollars of foreign crypto investment to Indian startups and small businesses. can be found

Crypto India Stake

The first step to understanding Crypto India Stake is to understand India Stake itself. It is a set of national APIs for payments, identity, KYC, e-signature, and document verification that reaches one billion people. Here is a quick overview of India Stack APIs:

For further reading, two of the best contemporary references on India Stack are (a) the official developer and policy documentation at and (b) this unofficial guide to India Stack by two iSPIRT volunteers. But importantly, India stack APIs like UPI and Aadhaar provide world-class software infrastructure for India’s domestic economy.

About Decentralized Finance

The second step to understanding Crypto IndiaStack is to understand the state of crypto in 2021:


performance First, before getting into DeFi in particular, crypto in general is good for payments that are very large, very small, very fast, very automated, very international, and/or very complex compared to traditional financial systems. are transparent. For example, you can use microtasks to programmatically distribute $100,000 to 50 different countries for payments of $10 each, confirming transactions on the Ethereum blockchain almost instantly. can give, and settle the amount completely within minutes. That all 1000 recipients can spend their earnings. You can raise $30 million online in 30 seconds. You can even make money flow in real time instead of making people wait 2-4 weeks between paychecks. These types of feats represent a >10X improvement over the underlying financial base and are impossible with the old banking system. Crypto has therefore enhanced the efficiency of global finance on several dimensions.

Programmability. In addition to these raw performance improvements, crypto also offers programmability – and this is the core of defi.


Transparency. Finally, decentralized finance is much more transparent, and therefore reliable, than tradfi. Every transaction is logged on-chain and protected by encryption, which secretly allows strict accounting and auditing. More reliable financial statements are a form of informational assurance. As discussed below, this type of data can be critical to unlocking new investments in physically-correlated-poor areas.

Four Steps to Adding Crypto to India Stack

Okay fine. Now we understand a bit about both India Stack and crypto, specifically decentralized finance. Why is the combination so powerful? Well, there are millions of smartphones in India now. By adding both digital rupee and crypto support to India Stack, we can turn every phone into a real Bloomberg terminal, not just a bank account, allowing every Indian to make domestic and international transactions of arbitrary complexity. Gets potential, and attracts crypto capital from around. The world, and completely leapfrogging the 20th century financial system.

How do we get there? In four easy steps:

  • Understand what digital currency is.
  • Add digital wallet support to India Stack.
  • Add Crypto Assets to India Stack Digital Wallet
  • Extend India Stack APIs with crypto concepts.

1. Understand what digital currency is.

The first step is to define exactly what a digital currency is. This concept can be confusing to many people. After all, don’t they already see the digital balance of rupees in their bank account? So what will the digital rupee do anyway?

2. Add a digital wallet to India Stack.

The first step would be to add a digital wallet to India Stack that supports the digital rupee. The right entry point would be the Unified Payments Interface, which already connects hundreds of Indian banks. Any computer running the India Stack open source digital wallet will then be able to download digital rupees and send them to any other computer running the digital wallet, potentially without going through a bank or fintech intermediary. Each such transaction could work like existing UPI, with instant payments between wallet holders, although many blockchain concepts could be used to protect the user, such as local private keys.

3. Add crypto assets to India Stack digital wallet.

Very soon, users of India Stack Digital Wallet and Digital Rupee will demand crypto functionality. Why? For many reasons, but perhaps the most important is because Indian users will want to access the pool of crypto capital from around the world. Foreign holders of Bitcoin, Ethereum, and other crypto assets want to invest in the Indian economy, Facilitating this capital formation can help close the MSME financing gap, as discussed below and in the companion section on iSPIRT.

4. Extend India Stack APIs with crypto concepts.

The fourth phase of building Crypto IndiaStack will involve going API by API and gradually crypto-ifying them, augmenting IndiaStack’s native APIs with ideas from the blockchain space and connecting them to international crypto protocols as needed.


all right! We covered a lot of ground. But this is a long form matter of how and why we should build a crypto India stack. Just to summarize:

Add both digital rupee and crypto protocol support to India Stack. It’s not blockchain or cryptocurrency, it’s both/and. Call this fusion Crypto IndiaStack, and use it to access both domestic payments and international crypto protocols on every phone.

A Crypto India Stake will help Indians locally by giving them access to crypto capital. Adding crypto to the India stack helps India locally by enabling new forms of debt . It helps close the $250B+ MSME financing gap, it gives startups access to growing financial internet, and it allows faster payments for remote workers and remittance recipients.

A crypto India stack enhances India’s prestige abroad as a software stack for a multipolar world. India should champion national stakes and decentralized crypto protocols as a way to (a) allow countries to reduce their dependence on American and Chinese tech companies, (b) allow the Indian state and Indian Earn hard currency for citizens, and (c) develop. India’s reputation as a peacemaker, a neutral third party, a software superpower, and a global facilitator.