Managing Cryptocurrency amid policy uncertainty in a volatile market


Cryptocurrency is an unstable market with frauds and wild price fluctuations lurking within it. For India, there is another problem the government has not yet decided what to do with it.

But the lure of investing in cryptocurrency is not something many Indians cannot ignore. Experts say that the investment should be 5-10% of the investment portfolio and that money should be something they should not regret losing.

The government was expected to introduce a cryptocurrency bill in the winter session of the parliament but did not. Many experts think that the government may introduce it in the Budget Session.

The RBI and SEBI are approaching the issue with caution, with the government stance in uncertainty. But if any regulation should come, it should be considered as an asset class, with 5-10% investment in the portfolio.

Even though the term currency is used, cryptos should not be considered as an actual currency. Experts say that it should be a store of a value-an asset class. This entity has a lot to go to become a currency per se.

Before one enters the cryptocurrency market, one should look at Blue Chip crypto assets. When it comes to investing in these assets, they should also look at expert opinions. For that, they should use White Paper instead of a blog.

As a result, it is important to do proper research before starting a crypto investment and decide the reason for investment in the first place. Is it for increased returns or as a store of value? If it is the former then it is quicker to lose money.

Crypto investments should be long term ones starting from a small investment. To begin, you should invest using trusted exchanges that would only use trusted coins. They should also look at the limit on the number of available tokens of the asset.

The main factor is, one should avoid investing in FOMO or on a sudden urge. They should approach it fundamentally and objectively and only take credible ones. It is difficult to predict the future of this volatile market.

Once again, the answer to this predicament is to invest small, that one would add on in future, thus making it a long-term investment. And for that kind of long-term investment means storage by a hardware wallet.

But if it is small, then storing it by the exchanges will do. It does come with a fee and fixed transaction charges.

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