If you are new to investment, I would not recommend you to invest in cryptocurrency. Equity in the form of mutual funds is suitable if you are looking for long-term investments, or else fixed deposits or debt funds can take care of short-term goals.
Cryptocurrencies are highly volatile and can lead to significant losses. Would you be comfortable with a 50-70 per cent erosion of your invested value within a year? Crypto is unregulated in India, making them prone to fraud and market manipulation. Remember, they have no investor protection mechanism. Unlike stocks or bonds, cryptocurrencies don't have underlying assets or earnings, making their value purely speculative.
The high-risk, high-reward nature of crypto can also lead to impulsive trading and addiction.
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Esta historia es de la edición November 2024 de Outlook Money.
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