Bitcoin surge: Why should you still not invest in cryptos? These are 7 key reasons

livemint.com:

After breaching $68,800 i.e., hovering its all-time high, bitcoin pared some of the gains on Tuesday in the international crypto markets to trade around $66,700. 

According to data shared by Crebaco, a cryptocurrency research firm, trades on Indian exchanges CoinDCX, WazirX and BitBNS hit $2.6 million, $3.4 million and $7.8 million, respectively, in February clocking their highest ever volumes since June 2023.

ALSO READ: Bitcoin surges to $66,000, market cap crosses $2.5 trillion

Bitcoin had reached its all-time high of $68,990 in November 2021. 

There are still some experts who continue to believe that cryptocurrency is not a safe investment and one should stay away from it as a credible investment option.

1. Lack of regulations: In India, cryptocurrencies are yet not regulated. As capital markets regulator Sebi regulates investments in stocks and derivatives, banking transactions are regulated by the RBI; crypto transactions do not have any regulator as yet.

 2. Volatility: Price rise is a function of volatility. When bitcoin can spike because of it, it can – conversely – pare gains at the same time at the same pace. Bitcoin has moved from $68,000 to $28,000 to return to $68,000 between Nov 2021 to March 2024. In 2023 alone, bitcoin jumped by a whopping 160 percent.

Deribit DVOL index, a measure of expected price volatility of bitcoins over the next 30 days, has surged to 76%, highest since Nov 2022, CoinDesk reported. 

3. Critical views: Time and again, India’s banking regulator Reserve Bank of India (RBI) has been overly critical of cryptocurrencies such as bitcoins. 

In a press release, RBI had even stated that any user, investors, trader, etc dealing with virtual currencies will be doing so at their own risk.  

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