Bitcoin took a hit over the last few months, but its upsurge may have been the result of a buildup of its wider acceptance. The good days are back for cryptocurrency, claim experts
Breaking a three-month stagnation, Bitcoin surged back above $50,000 on Monday for the first time and reached a day’s high of $50,152.24. It was trading between $30,000 and $40,000 since mid-May before shooting up by 2.5% today. Bitcoin had plunged in May after touching the record high of $65,000 in mid-April.
Nischal Shetty, founder and CEO of crypto-exchange WazirX said $50,000 is a psychological number for Bitcoin.
The crypto community is elated to see this mark being breached and cautioned investors to see if this price level holds or will it drop back. He added that Global crypto adoption has been increasing every month. This naturally has put pressure on the supply of Bitcoin leading to the price rise.
Ashish Singhal, Founder and CEO of crypto exchange Coin Switch Kuber termed the surge as an indication of retail and institutional investors being bullish on the asset for the past year.
“Chainalysis recently reported that India ranks second in the world for cryptocurrency adoption. There is an increasing awareness about Bitcoin and other cryptocurrencies among Indians, with people from tier-II and tier-III cities driving adoption. This mass adoption spells a positive outlook for Bitcoin prices,” said Singhal.
Avinash Shekhar, Co-CEO of ZebPay, said, “We recommend Rupee-Cost-Average (RCA) into crypto assets as a long-term investment strategy.
Using RCA, investors can get an average entry price for the asset and get better returns in the long run. SIPs are one way to do this and we have launched a new product, ZEBB to promote this long-term investment strategy. Anyone can start an SIP in Bitcoin or Ether on ZEBB starting with just Rs100.”
Shekhar said, “The current market surge was expected by firm believers of this technology asset class after the temporary sell-off which was a short-lived FUD in the market. BTC has absorbed pretty much all the negative news over the last quarter and yet, hasn’t dampened the impact on the institutional influx of money into this technology giving out a clear message on the strong fundamental value the asset poses.”
He added Bitcoin is fundamentally a very strong asset with a reliable foreseen future. The recent sell-off was a temporary uncertainty faced on accounts of the negative news in the market pertaining to some respective country’s stance on the mining aspect of the asset. Bitcoin has just picked the growth path to its base of strong fundamentals again where all types of investors from retail to institutions have shown immense interest and vision.
According to Global Crypto Adoption Index, the crypto adoption worldwide grew by 880% between June 2020 and July 2021. India ranks second in terms of crypto adoption worldwide behind Vietnam but ahead of developed nations like the US and the UK.
The market experts believe total value of cryptocurrencies was at $2.17 trillion on Sunday and the rally has been supported by cryptos like Cardano, Binance Coins, Dogecoin and Solana.
Singhal said, “The volatility in the cryptocurrency market is characteristic of a market that is still in its nascent stages. So, it is better for investors to invest in small amounts that might garner great returns but can also bear risks. Investing a particular amount regularly and in a disciplined way for the long-term can build wealth for the investors.”
Notably the plunge in cryptocurrency has arrived with last week, Indian finance minister Nirmala Sitharaman’s announcement that the Bill on Cyrptocurrency in India is complete and awaits the Union Cabinet nod.
Nischal added that the crypto ecosystem in India needs positive regulations. Guidelines on what crypto startups should adopt such as KYC, AML, Customer Support and more, would be helpful.
Similarly, Singhal added “the Indian cryptocurrency industry that will foster not just cryptocurrency space but also the technologies, like blockchain, associated with it, creating a significant spot for India on the map of global technology leaders. The regulations will bring certainty for interested investors who have been hesitant so far due to the lack of clear regulations and encourage more cryptocurrency adoption in the country."