As we seek refuge in today’s disruptive world following a pandemic, the massive wave of digital transformation that we are all witnessing is not far behind our assets and investments.
A growing number of astute investors are seeking to diversify their portfolios by investing in new asset classes such as cryptocurrency. Since its inception in 2009, India has been a part of the growing global trend of cryptocurrency adoption.
While every discerning investor wants a piece of the potential upside of this new asset class, regulatory guidelines and volatility are keeping many investors on the sidelines.
Do you understand why you should invest in cryptocurrency?
When you use cryptocurrency as a trading option, you have complete control over your assets as an investor. Because the investment model is fundamentally decentralised, cryptocurrency traders have complete control over their assets and can own and store them without the involvement of a middleman or third party.
Because the investment is transparent, you have complete control over your money. You can trade whenever you want, regardless of the time of day or night, because the backend technology is publicly verifiable and crypto currency is available 24 hours a day, seven days a week.
Long-term gains appear to be possible. As cryptocurrency investments have been used in real-world transactions, the line between digital and real money has become increasingly blurred in recent years.
The disadvantages of investing in cryptocurrency
Many investors have shied away from cryptocurrencies due to their high volatility and stringent regulatory requirements. Because the rules governing this digital asset are constantly evolving on a global scale, it’s critical to stay on top of crypto regulations and ensure your service provider complies with Indian laws.
Countries all over the world are working to develop and implement cryptocurrency investment regulations in order to keep track of everything that happens in this space and reduce instances of illegal activity. Indeed, regulation will be the driving force behind the next major shift in the cryptocurrency market.
Demand and supply are important factors in the liquidity and stability of cryptocurrencies, so understanding them is essential. In general, as demand rises, investors benefit because holding such investments becomes more profitable.