Key Takeaways
- • Speakers at the Business Standard Smart Investor Arena urged young investors to research the fundamentals of cryptocurrencies and invest only amounts they can afford to lose.
- • S B Seker, head of Asia-Pacific at Binance, and Vimal Sagar Tiwari, cofounder of CoinSwitch, spoke at the session 'The Gen Z Portfolio: Does Crypto Still Deserve a Seat at the Table?'
- • Tiwari suggested beginners start with as little as ₹100 or ₹500 to understand how digital assets work.
- • Both speakers identified tokenisation and stablecoins as key developments in digital finance and flagged quantum computing as a potential future threat to blockchain cryptography.
- • Speakers cautioned against investment decisions based on tips from friends or family and advised assessing financial circumstances, goals and risk appetite before allocating capital.
Summary
Young investors should understand how cryptocurrencies derive their value and the risks involved before investing, according to speakers at the Business Standard Smart Investor Arena. Speaking at a session titled 'The Gen Z Portfolio: Does Crypto Still Deserve a Seat at the Table?', S B Seker, head of Asia-Pacific at Binance, and Vimal Sagar Tiwari, cofounder of CoinSwitch, urged investors to prioritise research over speculation and to avoid acting on tips from friends or family.
Tiwari said the starting point for any asset class is understanding its fundamentals, advising beginners to understand how Bitcoin derives its value. He compared Bitcoin to digital gold, citing its limited supply, and likened Ethereum to an operating system on which developers can build applications, noting that its potential value is linked partly to the products and services built on its network. He recommended starting with small amounts and avoiding money that may be needed in the near term, suggesting beginners could start with ₹100 or ₹500 to understand how the asset works.
Seker advised investors to study the technology behind digital assets, including blockchain networks, wallets and transaction verification, which could help them assess risks in individual projects. He said investors should review a token's white paper, use case and potential market before forming a view, and evaluate whether a token has a viable use case and can compete with newer alternatives. He also said investors should assess their financial circumstances, investment goals and risk appetite before allocating to digital assets.
Seker identified tokenisation and stablecoins as key trends in digital finance. Tokenisation, which represents assets digitally on a blockchain, could allow fractional purchases and trading beyond traditional market hours, he said. Stablecoins, designed to maintain a relatively stable value often by tracking a conventional currency, are another development investors should watch.
Both speakers flagged quantum computing as a potential future challenge to blockchain cryptography. Tiwari said developers were working on possible upgrades but cautioned investors against assuming every risk would automatically be resolved. On regulation, Seker said rules often evolve in response to technological innovation, while Tiwari said Indian investors should monitor the regulatory framework, including the role of the central bank's digital currency.
Tiwari said the starting point for any asset class is understanding its fundamentals, advising beginners to understand how Bitcoin derives its value. He compared Bitcoin to digital gold, citing its limited supply, and likened Ethereum to an operating system on which developers can build applications, noting that its potential value is linked partly to the products and services built on its network. He recommended starting with small amounts and avoiding money that may be needed in the near term, suggesting beginners could start with ₹100 or ₹500 to understand how the asset works.
Seker advised investors to study the technology behind digital assets, including blockchain networks, wallets and transaction verification, which could help them assess risks in individual projects. He said investors should review a token's white paper, use case and potential market before forming a view, and evaluate whether a token has a viable use case and can compete with newer alternatives. He also said investors should assess their financial circumstances, investment goals and risk appetite before allocating to digital assets.
Seker identified tokenisation and stablecoins as key trends in digital finance. Tokenisation, which represents assets digitally on a blockchain, could allow fractional purchases and trading beyond traditional market hours, he said. Stablecoins, designed to maintain a relatively stable value often by tracking a conventional currency, are another development investors should watch.
Both speakers flagged quantum computing as a potential future challenge to blockchain cryptography. Tiwari said developers were working on possible upgrades but cautioned investors against assuming every risk would automatically be resolved. On regulation, Seker said rules often evolve in response to technological innovation, while Tiwari said Indian investors should monitor the regulatory framework, including the role of the central bank's digital currency.
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