India’s crypto market is fast growing and it’s the youth that’s driving this growth. The concept was still new for many till a few years back. Now, India is now the largest crypto market in the world. Though the numbers can be debatable. A recent report by BrokerChooser claimed that there are more than 10 crore crypto owners in the country. However, homegrown platforms have maintained that they only have 2 crore crypto investors as of now. In either case, the youth is finding crypto as a quick way to make money. Or, at least the apps are making them believe so.
You turn on the TV for 15 minutes, and I am sure you will bump into at least one advertisement claiming that investing in Bitcoin is possibly the best thing you can do today. Some of these ads are making crypto investments sound easier than buying fruit. Others are suggesting youngsters invest in crypto instead of buying gifts for their parents. Most youngsters are falling for it.There is a general belief among young investors that crypto is gaining acceptance in the world economy and will make them rich overnight. There is also the fear of missing out. The crypto apps are trying to use this to their advantage by providing easy ways to invest.”The ease of investing in cryptocurrencies has partly contributed to the “craze” among young investors. There are no legally required KYC procedures or customer onboarding rules that a crypto exchange or platform must adhere to when enabling a trade. Customer-friendly interfaces and end to end digital transactions have made cryptocurrency trading accessible to several segments. There is also a sense that globally, as an asset class, cryptocurrency is gaining legitimacy and will likely become more widely accepted and used, which could potentially drive-up value,” Shilpa Mankar Ahluwalia, Partner and head-fintech at Shardul Amarchand Mangaldas & Co told India Today Tech.Indian youth crucial for crypto growthThe National Association of Software and Services Companies (NASSCOM) claimed in its September report that at this pace, the Indian crypto-tech industry can rise up to $241 million by 2030. This means India and its youth is set to play an important role in deciding the future of crypto market. But, does the youth understand what it’s getting into?There is no doubt that crypto has made people rich. It may continue to do so for a while. But, there are also risks involved. We have seen the market crash in the past and it is still quite volatile. The bigger concern, however, is the lack of laws or regulations. So, if something goes wrong, there is no body these youngsters can turn to with their complains.”Cryptocurrency in India today operates in a completely unregulated space. There are no laws that govern who or which entities can issue cryptocurrencies or how the exchanges on which cryptocurrencies are traded must function and settle trades. Consequently, there is no grievance redressal framework. Young investors should be mindful of not just the investment risk but also the fact that this is an area that is likely to be regulated very soon, which would most certainly have implications on price, liquidity and resale value,” Shilpa warns.Role of social mediaSocial media has also played a big role in pumping cryptocurrencies. Take Dogecoin, for example. It was supposed to be a joke that went too far. Elon Musk put out a few cryptic tweets which brought people’s attention to DOGE. As few invested in it and the prices went up, almost everyone wanted a share of the pie. This is the dangerous side of crypto investments.”There are different categories of investors coming into the market now. Some just want to experiment with the global trend of crypto adoption, whereas some don’t want to miss out on the trends on social media—like the one we’ve seen with Dogecoin! But, if you take the majority of the investors, who are the long-term hodlers of crypto, these are educated investors who look forward to crypto as a futuristic asset class and believe in the potential of blockchain technology,” Avinash Shekhar, Co-CEO, ZebPay and Member Blockchain and Crypto Assets Council (BACC) says.Keep an eye on regulationsIt’s true that cryptos like Bitcoin and Ether have generated good returns over the long run. However, youngsters need to understand that they should be buying something because it’s easy to do. Buying a flat is easy. India probably has the largest inventory of unsold apartments. There are so many apps and brokers that can finalise the deal within minutes. But, you still spend months…sometimes years finding the right house before purchasing it.The same approach needs to be applied to cryptocurrencies or any investment for that matter. You need to read, consult and understand the nuances before investing in crypto. Proper regulations, whenever they come, should also help the investors and provide them with a sense of security.”As of now, crypto is a high-risk, high-reward investment option. India needs positive regulations so that we can foster innovation and focus on consumer protection at the same time. When it comes to crypto policy, India can take cues from developed countries such as the US, UK, Japan, Australia, EU region, etc., which are regulating crypto similarly,” Nishchal Shetty, CEO, WazirX and Member Blockchain and Crypto Assets Council (BACC) says.He also suggests that there should be guidelines for crypto businesses to ensure the safety of customer funds.The bottom line here is that there is no fast money. You need a systematic and sensible approach to grow your investments. There is an old saying – Do not place all your eggs in the same basket. Even if you want to be a part of this crypto wave, make sure you have invested in other tools to have some backup. Also, do not trust any stranger or platform. Do your research and consult with some crypto experts before investing.