Don’t panic-sell bitcoin in crash: Crypto startups
Indian crypto entrepreneurs are urging investors not to panic-sell assets like bitcoin and ether after prices crashed over 30% this week. According to cryptocurrency exchanges, investors should decide if they can sustain with locked funds for 3-4 years, and use only risk capital for what would be more of an allocation for long-term appreciation.
These digital exchanges facilitate trading for most of the1 crore Indian investors in highly volatile cryptocurrency assets. Users of some of these platforms were unable to place their orders due to the high volume of trading on Wednesday. While investing or trading in cryptocurrencies is a legal grey area, Indians owned about Rs 10,000 crore worth of such assets as of February.
“The market faced a bull run for three months, but a correction has just kicked in. This was expected to happen as the stability of the industry decreased,” said Sathvik Vishwanath, co-founder and CEO of Unocoin, which — founded in 2013 — is one of India’s oldest crypto bourses.
“Corrections are normal in financial markets. Crypto markets especially see such ups and downs in prices. Investors should remain calm during such dips and look at long-term gains,” said Raj Karkara, CMO of ZebPay, which was founded in 2015.
Crypto entrepreneurs stressed that investors should allocate risk capital if one is entering or averaging. “Investors should make sure they use only risk capital, which they can afford to lose, so they are less likely to panic if it (correction) happens,” Karkara said.
Industry people said market crashes are not alien to cryptocurrencies, and that bull runs after corrections have given returns in multiples. Crypto investors, who may be stuck at high prices, too should not panic-sell, according to them. “In these times, it is important for investors to decide if they can sustain with the locked funds due to a downtrend for 3-4 years and, if so, sitting tight appears to be the better option than going into a panic-sell mode,” Vishwanath said.
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