Amateurs Trading Cryptocurrency in Kashmir, Threat of Losing Money Prevails

Charmed by huge returns, youngsters are buying cryptocurrency and are quickly learning the market ups and downs.

SRINAGAR — With many investors making huge profits from cryptocurrency, a wariness remains with others losing money at the same time. Many in Kashmir are getting attracted to the uncharted digital territory for the lure of fast returns. Financial experts, however, urge caution while investing in the currency.

Aqib Nazir, a 22-year-old student from Srinagar is attending an online workshop on cryptocurrency. “Some of my friends invested and lost money. That is something I don’t want to do.” Aqib wants to learn cryptocurrency trading first, before he plans to invest in it.

The profits are too high for Shayan Nabi, an investor, to resist trading in cryptocurrency. Shayan doesn’t see a risk in cryptocurrency trading. “I believe cryptocurrency is the future.”

Shayan began trading cryptocurrency in 2013. Back then he didn’t have enough knowledge about it. “If I was completely aware of it back then, I would have been a billionaire by now.”

Charmed by huge returns, youngsters are buying cryptocurrency and are quickly learning the market ups and downs.

Cryptocurrency is an asset, according to Ejaz Ayoub, an economic analyst, that may be very profitable if handled carefully, “but you can lose money if you invest without knowing what you’re doing”.

“Many young people don’t comprehend crypto and invest in it out of fear of missing out,” Ejaz said. People also make the mistake of investing borrowed funds.

What is rapidly changing is that more and more young people are attending online and offline programmes to learn more about cryptocurrency.

While some people are rushing to invest in cryptocurrency, others are hesitant for “religious” reasons.

Arif Aslam, a Sopore-based engineer, began purchasing coins while his brother remains hesitant.

“I acquired a share of a coin last month and the profits are very high,” Arif explained, “but my brother refused to invest since some Ulema have declared it Haram.”

Azhar Mushtaq, a young entrepreneur, has the same aversion to investing in cryptocurrencies. The charm of cryptocurrencies is irresistible, but religion comes first, he said.

India has over a dozen local cryptocurrency exchange systems that offer trading and selling, with over 15 million members. According to BrokerChooser, a broker discovery and comparison website, India has the biggest number of cryptocurrency owners in the world, with 100.7 million, followed by the United States and Russia.

Following the Reserve Bank of India’s clarification on cryptocurrency in May this year, regulated banks were asked not to warn customers against cryptocurrency trading under its 2018 directive, which barred such transactions. This resulted in a surge in investments and many new domestic debuts.

Following the Supreme Court’s intervention on a challenge filed by the Internet and Mobile Association of India (IAMAI) and crypto exchanges, the three-year-old RBI circular was set aside in 2020.

If significant profits are possible, so are massive losses and fraud in Bitcoin trading—and there is now no regulating authority to which an investor may turn. The investor is solely responsible for the danger.

On the other hand, the profits will be subject to a 30% capital gains tax.

If you’re familiar with the economy, Shayan suggests that instead of holding money in a bank, you should buy a coin in crypto, because the return rate is too great here, unlike in a bank.

“Our forefathers invested in real estate or gold, but because those are both exorbitant, this generation must invest in cryptocurrencies,” Tanzeel, a college student, said.

Tanzeel began investing in cryptocurrency about five months ago. The market crashed a day after Tanzeel invested, and he lost money.

“Because I was new and didn’t know what I was doing, I panicked and sold all of my coins, which I subsequently realised was a mistake.” But Tanzeel learned from mistakes, and currently has 30,000 rupees invested in crypto currencies.” The only risk to cryptocurrencies, according to Tanzeel, is ignorance.

In 2018, a criminal case was filed against a representative of a private company for defrauding customers by accepting their Bitcoins and promising 1.8 Bitcoins for each coin in 18 months. “Frauds can be found anywhere, and one must be aware of them,” Ayoub said. “Carefully study before investing, and don’t put all of your savings into a single asset.”

Another investor said that he put money into the market this year and lost two lakh rupees. He began investing in 2019 and then Kashmir went into a communication blockade. “I recall reviewing my portfolio after a year and witnessed that it had tripled in value, which drew me in.” The market crashed in May this year, and “I lost money, but you learn from your mistakes”. The investor was able to recover the majority of the losses later.