According to ChainCatcher citing Economictimes, a severe supply shortage of stablecoins like USDT in India has driven local premiums above 8.5%, following intensified regulatory actions. Indian enforcement agencies have targeted firms offering crypto foreign exchange services, cutting off remittance channels commonly used by overseas Indians and directly impacting USDT availability. As a result, USDT is now trading significantly above international parity in the local market.
The widening premium underscores how regulatory crackdowns can distort crypto market supply-demand dynamics. When compliant channels are blocked, local liquidity tightens rapidly, creating arbitrage opportunities. With the Indian government continuing to tighten crypto regulations, foreign exchange and stablecoin supply may face further pressure in the near term, prompting investors to monitor policy-driven price volatility.