A growing number of Indians are investing in cryptocurrencies despite extreme volatility and lack of regulation. But the trend is not just due to the prospect of high returns. Some took to crypto to bet on blockchain technology, while well-designed trading apps attracted others. TOI spoke to young crypto investors to understand their goals, strategies, and fears as uncertainties persist in 2022.
Blockchain — a secure, decentralised ledger that enables crypto — was the focus of many backers. “My family faced several issues in land transfer. Blockchain could help solve such ledger management problems,” said a Bengaluru-based app developer. Crypto investors TOI spoke to didn’t wish to be named.
A law student said that crypto was more than an investment option for him. “I like its focus on decentralisation. Blockchain can solve so many problems in terms of duplication and transparency.”
Investors are aware that crypto won’t be allowed for payments. For them, it is simply a bet on a futuristic technology. However, they are careful of their monetary exposure to crypto in case a ban is announced. Many said they invest only what they can afford to lose. The Bengaluru-based app developer has invested less than Rs 1 lakh, while another investor has allocated just 5% of his portfolio to crypto.
For others, crypto is hard to ignore because of the ease of investing. “The technology crypto exchanges have created for UI/UX (user interface/user experience) makes it very easy for users to transact. Even the biggest banks are unable to simplify what’s on the screen when trading stocks,” an investor said.
A 26-year-old Gurgaon-based investor said he opened an account with a crypto exchange after seeing a TV commercial in May. “First, it was just for investment. But once I started to understand the tech behind crypto, I invested more,” he said. The youngster has seen his Rs 3-lakh investment grow nearly threefold.
Most investors have similar strategies: Buy on dips and sell only when necessary. However, crypto investors don’t have a complaint-resolution mechanism. “Banks keep disabling services to crypto exchanges arbitrarily. As a result, it’s a nightmare to withdraw funds,” an investor said. Due to lack of regulation and fears of a ban, some Indians have even moved their investments to foreign crypto exchanges. Blockchain backers are also concerned about traps like ‘shitcoins’ — a term used to refer to cryptocurrencies that have no specified function or innovative quality.
While the last two years saw strong rallies, 2022 may not be a good year for bitcoin. “Bitcoin is showing a bearish trend in short- and medium-terms,” said Rajendra Agarwal, founder, Autus Investment.
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