Crypto is not a get-rich-quick scheme; millennials must choose long-term for balanced portfolio: Experts

India’s millennials and GenZ are digital-savvy; they identify and adopt technology early and are focused on long-term potential. An average Crypto investor is 28 years old – they understand the potential of Crypto, want long-term financial goals and aim for a well-rounded portfolio. Short-term market cycles shouldn’t change that. Crypto is not a get-rich-quick scheme, said Ashish Singhal, co-founder and CEO of Coinswitch Kuber.

Singhal believes that crypto is bringing a once-in-a-generation technological shift that will reshape the internet and internet-based businesses and services.

Millennials have a greater risk appetite which draws them towards investing in cryptocurrency. According to one report, about 39% of millennials own cryptocurrencies, higher than the percentage of those who own mutual funds and about equal to the number of millennials who own individual stocks.

I think all investments carry some risk, with crypto leading the list, but we have a greater risk appetite. I have also invested in cryptocurrency, but I prefer the government to regulate it so that the privacy concerns are addressed. With talks of a central bank digital currency, I feel crypto could become very important,” said Shreyashi Haldar, program analyst at Wells Fargo.

Although the cryptocurrency market is at an all-time low now, Rajagopal Menon, Vice President, WazirX said there is no indication that millennials are moving out of crypto, but he highlighted that the number of users within the age group is intact.

If we look at the transactions between December 2021 to March 2022 vs. April to June 2022, it is clear that the share of millennials investing in stablecoins has increased by 13%, which is significant, while their holdings of meme coins have decreased. This can be attributed to investors becoming more informed and research-oriented while choosing to invest, Menon said.

Debrishi Pramanik, a software engineer at a leading MNC said that he would not want to withdraw his crypto investments even if the market crashes every other day.

Every market goes through a bull and bear phase and right now the cryptocurrency market is going through its bear phase. I feel that those who opt out of crypto due to the volatility that the market is showing are going to regret their decision in a few years. I feel this is the right time to invest if you want to expand your portfolio and make some quick money, as soon as the cryptocurrency market will rise and reach record highs, those who were patient with the turbulence in the market will be the biggest winners, said Pramanik.

A report suggests that the digital investment market is set to be worth $14.3 billion by 2025, growing from $6.4 billion in 2021 at a 5-year CAGR of 22.4 percent supported by India’s fintech boom.

Minal Thukral, Executive Vice-President, Growth and Strategy, CoinDCX believes that millennials are certainly more inclined to invest in crypto than previous generations.

Millennials are more focused on understanding the fundamentals of the tokens they invest in. They are also more open to taking risks and adopting new technology. We have also observed that most millennials make informed decisions. They invest after understanding the fundamentals of the industry, he said.

Chintan Avasthi, a final year MBA student said that he lost almost half of his invested amount due to the current market crash and he did not want to take the risk of further loss.

I had invested in crypto in 2021 and had seen positive growth, but the current crypto crash washed away all the profits and the amount I invested was reduced to almost half. The bear market phase has been going on for quite some time now, and in addition, crypto tax has also been introduced. I didn’t want to take the risk anymore, so I have withdrawn my crypto investments,” said Avasthi.

Thukral also highlighted that there had been little impact on the number of millennial investors, due to the current bear phase of the crypto market.

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