Crypto Market Outlook : How Global Liquidity And Regulation Are Shaping Cryptocurrency Market - Expert Insight

In this exclusive conversation,  Vikram Subburaj, CEO of Giottus Crypto Platform, shares his perspective on the state of the market. He delves into the impact of global liquidity shifts, the growth of decentralised credit platforms, and the significance of regulatory developments like MiCA in the EU and Bitcoin ETF approvals in the U.S.

Subburaj also discusses India’s cautious but progressing regulatory stance, ongoing engagement between the industry and policymakers, and how the country’s tech-savvy population is helping redefine crypto’s global narrative. 

Question 1: The crypto market has seen significant shifts recently, from institutional adoption to macroeconomic influences like liquidity trends and regulatory developments. Could you provide insights into the current state of the market, particularly the impact of recent global liquidity movements and the rise of crypto credit platforms? How are these factors shaping investor sentiment and market stability?

Answer: The current crypto market is in a new and critical era that is being shaped by multiple factors. There is tighter global liquidity and cautious optimism on part of large institutions. This is especially true in the case of risk-on assets like crypto. Liquidity trends, especially from the U.S. and EU central banks, are rippling into digital assets and this is subtly steering risk appetite. Institutional inflows through spot Bitcoin ETFs (over $36 billion in 2024 alone) deepened market liquidity and lent long-term confidence. The collapse of CeFi lenders in 2022 exposed systemic risks. However, DeFi lending surged and grew by over 950% since late 2022.

These trends are shaping sentiment. Volatility is near historic lows even as prices rise. Bitcoin’s 30-day volatility in 2025 is under 50% annualised. Investors, especially institutions, now view crypto less as a speculative bet and more as a macro asset.

As traditional credit tightens, crypto credit platforms are offering decentralised lending alternatives. Such activities are fuelled not by fiat reserves but by smart contracts and community consensus. This has ushered in a hybrid investor who is risk-aware but opportunity-hungry. We are witnessing a shift in sentiment that is more informed and less speculative.

Regulations, too, play a crucial role. Europe’s MiCA, UAE’s licensing, and even India’s tighter compliance (despite its high taxes) are bringing transparency and legitimacy. The result is a more stable, resilient market. If this trajectory holds, crypto could become a cornerstone of global finance—trusted, regulated, and integrated.

Question 2. With geopolitical events such as U.S. President Donald Trump’s proposed tariffs on EU imports, we’ve seen crypto markets react sharply. How do global political decisions and macroeconomic policies influence the crypto industry? Do you foresee cryptocurrencies becoming more intertwined with traditional financial markets due to these developments?

Answer: The crypto market no longer reacts in isolation. Trump’s proposed tariffs on EU imports may seem distant from Bitcoin, but markets are interconnected. Crypto has emerged as a high-beta asset and a refuge as traditional finance hedges against inflation, trade wars, and supply chain disruptions. We are in a phase where global macroeconomics is highly crypto-relevant. Regulatory convergence and rising ETF approvals suggest that crypto will soon cease to be an ‘alternative’ and instead become embedded in global financial architecture. 

Question 3: India has taken a cautious approach to crypto regulation, with high taxation and ongoing discussions about policy frameworks. How do you see the Indian regulatory landscape evolving? Are there any active discussions between industry stakeholders and policymakers that could lead to a more balanced regulatory framework? What lessons can India learn from global regulatory models such as the U.S. SEC’s approval of Bitcoin ETFs or the EU’s MiCA regulations?

Answer: India has always adopted a wait-and-watch, measured approach to crypto. This reflects the government’s focus on finding a fine equilibrium between innovation and risk. Active industry-government dialogues are continuously ongoing. The Ministry of Economic Affairs is soon coming out with a concept paper on crypto. There is a definite momentum towards a framework that recognises the legitimacy of the asset class and safeguards economic interests. The U.S. SEC’s Bitcoin ETF approval and the EU’s MiCA are instructive and can be emulated for Indian conditions. Such international regulations merge clarity, accountability, and public interest. A tiered, risk-based Indian model that is distinct but informed by global trends can enable innovation without compromising financial stability.

Question 4: Security remains a major concern, with incidents like exchange hacks and regulatory scrutiny affecting investor confidence. What are the biggest risks facing crypto platforms today, and how are companies addressing security vulnerabilities? Additionally, how do you view the role of decentralised finance (DeFi) in mitigating risks compared to centralised exchanges?

Answer: Security is the backbone of trust in digital finance. The industry has matured a lot, and leading exchanges invest heavily in real-time threat detection. As a second layer of protection, exchanges also spend on multi-party computation wallets and insurance-backed custodianship. However, centralised platforms will always be honeypots for hackers. DeFi, despite its nascency, introduces a powerful counter-model which is non-custodial, transparent, and programmable. Protocol risks remain, but the open-source nature of DeFi allows community audits and rapid patching. Going forward, hybrid models (read, centralised compliance with decentralised infrastructure) may redefine safety in crypto. This said, all exchanges are still adopting layered, conventional cyber threat detection and mitigation strategies as well to ensure fund safety. 
 
Question 5. Institutional interest in crypto has surged, with major firms investing in Bitcoin and blockchain-based financial products. How do you see institutional adoption evolving over the next few years? Will crypto assets become a mainstream part of investment portfolios, or do you anticipate continued volatility and scepticism from traditional financial institutions?

Answer: We are witnessing an institutional adoption shift from curiosity to conviction. A lot of large institutions are adding crypto to their reserves. Also, many companies are including crypto to their balance sheets. There are tokenised treasury products and programmable debt instruments now. These are not incidental any more. These are deliberate, thought-out outcomes of a new and evolving financial ecosystem. As regulatory clarity improves and custody mechanisms mature, crypto assets will increasingly be viewed through the lens of portfolio diversification and macro hedging. Volatility may persist, but so will innovation. The smart institutions are not waiting for stability but they are actively building it.

Ques. Despite regulatory hurdles, India remains one of the largest crypto markets globally. How do you see Indian investors shaping the future of the crypto industry? Are there specific trends in India, such as the rise of retail investors, blockchain startups, or government-backed digital currency initiatives, that could redefine the country’s role in the global crypto ecosystem?

Answer: India’s demographic dividend with young, tech-native, and financially curious people is the engine that propels the crypto momentum. Many founders and the exchanges started by them, including Giottus, persisted through years of regulatory uncertainty to come to this stage of evolution. In spite of this uncertainty, we have seen consistent retail interest, developer growth, and blockchain experimentation. There has also been a high level of innovation on part of the service providers. From the country’s psyche, India was never afraid of fintech transformation as it is evident from our adoption of UPI to ONDC. We can expect similar strides in tokenised assets, cross-border settlement, and CBDC integration as well. The future of crypto is not being dictated in New York or Brussels alone. It is being co-authored in Bengaluru, Mumbai, and Kochi.