If you’re in India and thinking about investing in cryptocurrency, you first need to know Bitcoin’s standing in India since its inception in 2009.
Bitcoins made a huge splash in India back in 2017 and was largely forgotten after the RBI motioned for a virtual currency ban.
In April 2018, the Reserve Bank of India (RBI) placed a blanket ban that prevented all financial institutions from providing any services to the Bitcoin industry.
Fortunately for cryptocurrency enthusiasts in India, the cryptocurrency ban that spanned over 2 years was lifted by the Supreme Court (SC) of India in May 2021. The market welcomed Bitcoins with open arms.
What Is Bitcoin Stock?
First of all, let us address the term “Bitcoin stock.” Bitcoin stock or Bitcoin equity is similar to any other stock in the market representing ownership of a fixed amount of Bitcoins.
Like traditional stock owners, Bitcoin stock owners receive a portion of the profits gained when Bitcoin’s price goes up in the crypto market. And of course, you stand to make a bigger profit if you own more bitcoins or their fractions.
Risk of Bitcoin Investment
Investing in Bitcoin may look like the lucrative investment opportunity right now with Bitcoin breaking all of its past records and new all-time highs quite a few times over the past few months.
But while it is one such investment that has yielded multifold returns with an excellent track record, it has some level of risk involved.
And the most prominent risk associated with Bitcoin and cryptocurrencies at large is market volatility. The cryptocurrency market is highly volatile, proving to be a downside for investors looking to day trade in cryptocurrencies or someone who wants to invest for a short run.
However, this risk is curbed for investors who wish to stay in the game for the long run.
Now that you know what bitcoin stock is where it currently stands; let me jump onto answer the most relevant questions around the topic:
Is It Profitable to Invest in Bitcoin Stock?
Research and current market trends say, Yes!
As always, it is impossible to predict the exact returns on any investment, but learning more about how Bitcoin works will take comes a long way. Buy BTC in India at the best rate.
To give you perspective:
Considering the last 5 years, The return of investment given by Nifty 50 was approximately 8.5%, whereas the return of investment given by Bitcoins despite the 2-year cryptocurrency ban in India was nearly 93%.
Now that you know the profits involved here, another question that pops up here is.
Is Investing in Bitcoin Stock Really Worth?
And quite frankly the crypto market is volatile. But so is the stock market, especially these days, because of the uncertainties world economies face as an aftermath of the Covid-19 pandemic.
We may likely be looking at another global recession post the pandemic. And as the market remains unpredictable, there are few better ways to protect your investments against a volatile market than to invest in inflation hedges.
Inflation hedges are basically investments that protect you against financial losses that occur when the purchasing power of your national currency drops due to macro-economic reasons or inflation.
While gold has been the investor’s favourite choice for creating inflation hedges, Bitcoin has historically shown more potential and offered higher investment returns.
The return of investment delivered by gold in the last 10 years was over 116%. However, the return of investment delivered by Bitcoins in the last 10 years was, as mentioned before, 89,00,000%.
Bitcoins, being a decentralized form of currency, are also largely unaffected by government policies. So, for cryptocurrency enthusiasts, Bitcoins have overtaken gold and even bonds to become the new favourite financial asset in the marketplace.
Pros of Bitcoin
From an investing standpoint, Bitcoin does have some pros to it, which are as follows:
- Potential of Many Fold Returns
Bitcoin is one such asset class that has gained extreme value in a concise span. Even after this exponential growth, many still believe Bitcoin to have the potential to make new records with it becoming more established with every passing day.
- Inflation Hedge
Similar to gold, Bitcoin is a deflationary asset due to the limited supply of 21M Bitcoins.
- You Can Buy a Portion of Bitcoin
Unlike stocks where you have to buy at least one stock to invest in the case of Bitcoin and Cryptocurrencies, you can buy a portion of the Bitcoin with whatever amount you want to invest. The smallest unit is one satoshi, 0.00000001 BTC. Read our article on what determines the price of bitcoin for more information on buying bitcoin.
Moving on to the most important part, let’s understand.
How Can You Invest in Bitcoin Stock?
Investing in Bitcoins might seem complicated, but you’ll see that it is quite simple once you understand the process. And of course, good and thorough research is a preliminary step to making sound investments.
Step #1: You need to set up a digital account, an e-wallet, to store the Bitcoins you purchase. These wallets can be software wallets or hardware wallets.
Step #2: Once your digital wallet is ready, you need to complete your KYC (Know Your Customer) verification process, which will require you to fill in some basic details and upload proof of identity. This verification enables you to trade government-issued currency in exchange for Bitcoins.
Step #3: Next, link your verified e-wallet to your bank account, debit card, or credit card.
Step #4: Finally, you need to purchase Bitcoins in exchange for the Indian Rupee. There are many such platforms for you to choose from, and each one comes with its own unique selling point, so you need to choose one that fits your requirements.
Read in detail about how can you invest in bitcoin.
But for sure, one of the easiest ways to invest in Bitcoins in India is through cryptocurrency trading apps like CoinSwitch Kuber, which makes the entire translation process seamless for you.
Just do this, and you are a Bitcoin stock owner!
FAQs on Bitcoin Stock
1. What makes Bitcoin a Good Investment?
One of the reasons Bitcoin is an attractive investment option is because of its exceedingly high returns that surpass the returns on Gold and stocks. Check the everyday BTC to INR rate.
Other factors include decentralization and the potential to perform even better and become the future of money.
2. How Safe is it to Invest in Bitcoin Stock?
Investing in Bitcoin stock isn’t 100% risk-free; there is a certain degree of risk involved in Bitcoin investment. However, before investing, you should be aware of the same and learn to cope with it.
3. What is the Best Way to Invest in Bitcoin in India?
The best way to invest in Bitcoin in India is via an exchange like CoinSwitch Kuber. You can create an account on the app and finish your KYC in minutes to start buying and selling Bitcoins at the best rates.
4. Is 2021 the Right Year to Invest in Bitcoin Stock?
Currently, Bitcoin investing looks like a very lucrative option.
Bitcoin investments have started to pick up heavily this year and those who couldn’t get their hands on it during Bitcoin’s early days don’t want to miss on this opportunity.
Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.
Table of content
Subscribe to Our Newsletter with exclusive content.