Cryptocurrency — The urge to own a coin you cannot spend

| TL;DR at the end | Everything you need to know about crypto in India |

About this article

We’ll talk about why cryptocurrency cannot be an investment or even a viable form of payment for the average Indian right now.

WHY DO YOU WANT TO BUY CRYPTO?

There can only be a few possible reasons —

1. You think it is a cool concept and you’d like to try it.
2. You want to “invest” because you feel cryptocurrencies give high returns.
3. You want to pay people/businesses using cryptocurrency.

If you belong to category (1) I suggest you download one of the wallet apps and spend a small amount on any coin you want to. Having $5 worth of BTC is fun and you won’t regret wasting a bigger amount. You might also get lucky.

If you belong to category (2) or (3) read on.

SPENDING IN CRYPTO

Cryptocurrency wallets make decentralized anonymous transfers but —

1. The transactions come with a high fee which is in the range of $8 to $50 per transaction depending on the miners.
2. The transactions aren’t instant. The less you pay the longer you have to wait for the transaction to be processed.
3. There is a minimum transaction amount that is specific to each wallet.

Paying with UPI eliminates all three of these problems. The only reason someone would make a cryptocurrency transfer would be to stay anonymous and prevent the transaction from being recorded. But wallets in India require you to complete KYC and also record your transactions. So is there still a reason you would pay someone with crypto? Leave a comment.

// CONCLUSION //

| TL;DR |

1. If you want to buy crypto out of curiosity, buy small amounts that you won’t regret losing.
2. If you want to “invest” in crypto be ready to take huge losses for petty reasons such as a tweet by a celebrity or government crackdowns on miners. The price moves purely based on investor sentiment and isn’t backed by any commodity or currency.
3. Using cryptocurrency to pay someone comes with higher fees for lower waiting time. You can’t be truly anonymous as wallets require you to do a full KYC.

Disclaimer — This article is specifically for Indian readers. All views expressed are from my own experience in buying and holding BTC, ETH, DOGE, BAT, and XRP. No part of this article gives investment advice in any way. This article does not contain any paid opinions.