Young Investors Perspective On

Cryptocurrency
Completed Research paper
Subhendra Singh Aastha Gupta

Fostiima business school Fostiima business school

[email protected] [email protected]

Abstract

Adoption on any new technology is basically influenced by awareness and attitude.

Awareness is the basic element to make people use the technology. Attitude is a secondary
element to increase the use of technology by people. It is always the students and youngsters
who easily adopt technology and this study is conducted with college students studying
various courses like engineering, medicine, science, arts and humanities. The objectives of
the study were to verify the influence of attitude on adoption of cryptocurrency, the influence
of awareness on adoption of cryptocurrency and the influence of awareness on attitude
towards cryptocurrency. 
This paper explores how Indian investors see cryptocurrency to seeking exposure to the
growing cryptocurrency space in 2022. We examine the relationship between investor
attention, and measures of uncertainty, with the market dynamics of Bitcoin and
other cryptocurrencies. We find that increases in investor attention are associated with higher
returns, more volatility, and greater illiquidity in cryptocurrency markets,

Keyword- Legal tender to cryptocurrency, Youngsters about crypto, Investor mindset,

Crypto, currency, bitcoin, trading behaviour, trading strategies
INTRODUCTION

The journey of cryptocurrencies in India hasn’t been short of a roller-coaster ride. From
facing a ban to now being on the verge of strict regulations, the virtual asset has faced a series
of threats.
Despite uncertainty around the future of cryptocurrencies in India, investments in the
unregulated digital asset, especially Bitcoin, has shown a breath-taking upward trend since
2020. Data from various domestic cryptocurrency exchanges suggest that more than 1.5-2
crore Indians have invested in the asset class, hitting the $10 Billion mark in November this
year. The growing number of cryptocurrency adopters suggests a shift in the investment
paradigm in the country that is known to invest more frequently in gold and other safer
assets. Ahead of the much-anticipated Cryptocurrency and Regulation of Official Digital
Currency Bill, let us have a look at the journey of the virtual asset so far.
In this paper, we explore the role of investors' beliefs for trading in bitcoins and
cryptocurrency, how their decision power can impact Indian economy as a whole and can a
developing country like India adopt 100% in bitcoin and cryptocurrency as a medium
Additionally, recent research on cryptocurrencies has considered investors as homogeneous
in terms of their trading behaviour, which is contrary to the finding of disparate types of
investors reacting differently to given information.
As results, we are making thematic analysis 30 different types of investors trading Bitcoins,
Their motive and their future plans.
Related Work
As cryptocurrencies, such as Bitcoin, are traded on financial markets, we first review findings
about the role of information in general on financial markets. Thereafter, we review the role
of investors’ mood on their trading behaviour. Finally, we review literature that investigates
determinants of cryptocurrency markets (i.e., volume and price) that might also determine the
behaviour of cryptocurrency traders.

Review of Literature

Money makes the sector of commercial enterprise turnaround. Nonetheless cash is higher
than coins. Many different varieties of price like debit and credit playing cards differ, not
usually undoubtedly, from traditional guise of money.
As because the benefits and drawbacks of plastic cash are soberly and broadly debated, the
argumentation about e cash is greater ample mercurial; the topic trap much fewer warring
parties but flares excessive temperament.
Just 2 years ago, in March 2020, whilst preferred court docket set apart the RBI ban on
cryptocurrency buying and selling, cryptocurrencies had been an special and obscure asset
magnificence unknown to a big majority of Indians. Just 2 years down the line, India has
become the most important market for cryptocurrency trading. Consistent with the broker
pick out portal, there are 10 Crore crypto proprietors in India. To give you a context about
this range, there are most effective 6 crore inventory marketplace investors in India. In terms
of economic assets, crypto is on the way to becoming 2 nd most preferred car for Indians
after constant Deposits.
What's even extra interesting is the truth that a big bite of cryptocurrency volumes are coming
from the 18-24 age institution, that's comprised in the main of college students with
practically no consistent income and extraordinarily low tiers of asset possession. In step with
a survey by buy Coin, this age institution debts for a whopping 30% of crypto volumes in
India. That is consistent with worldwide traits wherein cryptocurrencies are quite popular
among college students and the 18-24 age group usually accounts for 1/3 rd of the quantity.
Whilst it is a large super that cryptocurrencies are introducing our younger populations to the
idea of economic investments quite early in their existence, cryptocurrencies are in huge
element unregulated, and extraordinarily unstable in nature. A few precautions and
safeguards positioned in the way would possibly make certain that this cryptocurrency
publicity may be leveraged without causing any permanent intellectual or monetary harm.
Might-be crypto traders haven't any scarcity of picks in which to alternate, with a slew of
exchanges actively dating them. Structures inclusive of WazirX, CoinDCX, and CoinSwitch
Kuber have released social media campaigns to get more buyers on board and create apps
with consumer-friendly interfaces. Their staff interaction with customers on Twitter on a day-
by-day foundation and are short to address system defects. Separately, these buying and
selling platforms are lobbying the government for the benefits of blockchain generation and
digital tokens. Cryptocurrency exchanges do not permit buying and selling for buyers more
youthful than 18 years years old, however, many Indian teenagers skirt the policies by using
the usage of their parents’ credentials
Although investing in cryptocurrencies is permitted in India, there is no present legislative
structure that controls the industry there. Despite this, interest in this industry has grown, and
India is currently experiencing a tremendous growth in the cryptocurrency market. One in ten
of the world's bitcoin transactions in 2018 originated in India, driven by the curiosity of the
younger population, which sees cryptocurrencies as enticing alternatives to conventional
investing possibilities. Additionally, the epidemic might have influenced the rise in interest in
cryptocurrency trading. One of the biggest cryptocurrency exchanges in India reportedly seen
a 3x increase in users since March 2020.
Just as people invest in the stock market or buy gold, more and more Indian consumers are
getting confident about investing in cryptocurrencies, giving a fresh impetus to the FinTech
startups sprouting across the country.
It is not yet known when or what will be included in the cryptocurrency law that the Indian
Parliament is currently working on. The fact that a global growth in cryptocurrencies has
given rise to phoney trading platforms, frequently leading to fraudulent activities, is the main
cause of Indian authorities' scepticism. Some youngsters have already planned ways to
safeguard their investments from an abrupt ban, such as by maintaining multiple trading
accounts on both domestic and international platforms. Simran intends to send his bitcoin
investments to relatives who live abroad so that they can cash them out on his behalf.
Go for Big Coins
Overall, there are more than 20,000 cryptocurrencies that may be traded on different
platforms. Most currencies typically have extremely low volumes, which renders them
vulnerable to price manipulation and notable departures from overall crypto trends. Some
little coins that promise returns of 200% to 300% in a week may lure students, but the
majority of these investments are subject to manipulation and would essentially cause
financial loss. To give you an idea, there are more than 2,000 coins whose values were
permanently lost when they were lowered to zero. To reduce the danger of price manipulation
or fraud, students would do well to limit their exposure to large, widely-held coins like
Bitcoin (BTC) and Ethereum (ETH).
It is not Investment Vehicle
A key attraction for young investors is the chance to earn high profits by investing in small
amounts. For instance, WazirX enables investments into bitcoin with as little as 100-500
rupees ($1.4-$6.8).
Even though it's far authentic that crypto investments have the capability to provide 2
hundred%-300% returns in a few months, it is similarly genuine that crypto investments
convey excessive tiers of dangers, and it isn't always ordinary for traders to lose 50-70% of
their funding within few months. Although Bitcoin can recover quickly, it's also quite
possible for traders to remain at a heavy loss for decades. As an example, Bitcoin made a
then all-time excessive on 15 th Dec 2017 of USD 19,000 and continue to be below that
degree for the next three years and most of the time, losses for buyers have been in the range
of 58%. Therefore, crypto isn't an investment vehicle appropriate for building an MBA
corpus or severe existence-crucial aim. Truly setting it, if you cannot tolerate the lack of
capital, then crypto isn't for you. Crypto is precisely for human beings who've some
disposable savings, and the lack of that capital could now not compromise their life or life-
style goals in any manner
Come with a Casino Mind-set
When you go to a casino as a visitor, you aren't making plans to double your wealth through
the end of the night. You place apart a small amount for gambling knowing thoroughly that
there's a excessive probability that you may lose it all even as a win can give you temporary
life-style upgrades. Crypto investing ought to be approached in a comparable way. Students
should use crypto to get quick upgrades of their life. For instance, a appropriate goal would
be to get a better model of the iPhone or book a birthday party venue outdoor the stipulated
budget. Crypto making an investment must be a fun activity with the potential of an sudden
bonanza that is undertaken at a value which you are willing to lose.
Start Small and Don’t Forget to Exit
Begin with small quantities to recognize the market. Usually, any degrees which can be 60%-
70% down from the closing all-time excessive are proper entry points. If you need to average
down, watch for ranges to move at least 25% down from your present common fee. The
maximum important part is to not lose sight of the target. Regardless of bullish developments
or social media chatter, cash your holdings and go out the market once your way of life
objectives are achieved. There are not any proper peaks and bottoms for bitcoin and in greed
for extra returns, you take a hazard of losing your profits.
In the end, Cryptocurrency is more of a target practice at an early age which would prepare
students mentally and psychologically for future responsibilities of serious goal-planning and
wealth building in their earning years. With big movements on either side, cryptocurrencies
are more exciting than mutual funds and bonds for adventurous late teenagers or early 20s
and make it easy to induce them into financial planning at an early age.
Opportunities and Challenges
In step with a current survey, bitcoins are taken into consideration to have one hundred thirty
% returns in preference to 30% of gold this year. As promising as it sounds, cryptocurrencies
carry with them demanding situations that still chorus people from making an investment. In
keeping with the brand-new findings, 68% of the members (in a survey) earning extra than
INR 10 Lakhs consistent with annum quoted loss of regulatory readability as one of the
primary flip-offs while weighing up the funding parameters in cryptocurrencies. On the flip
side, 60% of the contributors earning less than INR five Lakhs consistent with annum-
determined investments in cryptocurrencies a frightening process bearing on the less
availability of possible alternatives. Similarly, to this, confusion around the regulatory ban in
addition to resistance in crypto bills provides to the industry challenges in growing.
No matter the demanding situations, various cryptocurrency exchanges or apps inclusive of
WazirX, CoinDCX, and CoinSwitch Kuber, have registered a significant hike in the number
of customers throughout the country. In line with a file, the transactions on bitcoins and other
cryptocurrencies have accelerated to approximately 30% in 2020-2021. WazirX is one of the
USA.’s biggest exchanges and the app has over 100,000 downloads on Google Play save, at
the same time as others like Zebpay (which relaunched in India in January 2020) claims to
have 3 million users international.
As user interest in this section grows, it's far the right time for advertisers in this category to
accumulate users and scale for the boom. The transactions on these cryptocurrencies may be
magnified if the cell advertisers pitch the app to its target audiences and to the audiences who
are interested but clouded with skepticism. But how do advertisers gather their audiences or
users on a huge scale?How to Strategize User Acquisition for Your Cryptocurrency App?
Acquiring users for a niche app such as a cryptocurrency vertical can be challenging because
of the targeted audience group your app needs. One needs to be careful while setting up user
acquisition campaigns keeping in mind both scale and LTV of the user, which can have a
long-term impact on the success of your app. Since many of the apps in this category are
fairly new, it helps to start with the below tips to strategize for user acquisition:
Recognize your target audience and choose your channels
The fulfillment price of your campaigns is immediately proportional to pitching your apps to
the right customers. Once it objectives the proper audience, the possibility of recording
conversions receives simpler. Your advert companion here performs a crucial position as they
have got the right equipment of their Armor to create a winning approach for you. Invest in
an ad accomplice who cannot handiest offer intelligent focused on gear however additionally
create targeting using probabilistic data and epigraphic concentrated on for creating specific
FinTech-savvy audiences – especially those already enticing with funding apps. As soon as
you have got diagnosed the right set of users, locating the proper discovery channels turns
into less complicated. As a brand new app, you may find it hard to navigate a unified
platform like MAAS takes the guesswork out of your marketing method via unifying all
channels, permitting you to reach big audiences throughout direct premium publishers, top
programmatic exchanges, and third-birthday celebration app stores and gadgets.
Creative formats
You need to start considering the creatives once you have determined your target audience
and channels in accordance with the KPIs. Your campaign's success can be greatly impacted
by choosing the correct group of creatives. Depending on the types of formats being utilised,
each channel performs differently. In addition to the structure, it's important to emphasise the
language's target audience-appropriate tone. It is preferable to utilise straightforward
language, particularly when discussing cryptocurrencies since people already have to deal
with ambiguous information everywhere.
Find the right budget and optimize for performance 
While choosing to promote your app through paid solutions on various channels, it can get
tricky to see if the allocated budget gives the expected returns. Create a test campaign with
measurable goals and budget distribution across various channels. Work closely with your ad
partner to analyse all your campaign performance data that offers real-time reporting and
actionable insights. 
Track your conversions
It is not enough to have data insights – what you do with that data also impacts your
campaign performance and subsequent success. Understand the behaviour of your users with
the conversion phenomenon such as the number of users checking out the app, installing and
using it. With the new apps, it’s recommended to focus on user acquisition first, followed by
retargeting, tracking clicks and impressions as the app matures. 
Gain competitive insights for first-mover advantage
With the crypto space getting fast populated by means of new gamers, it is essential for
entrepreneurs to move fast and first to advantage customers at scale and cause them to hold
coming lower back to the app. For this, gaining competitive insights can help. App marketers
can simplify this process by means of investing and running with a unified platform that
focuses on actual-time reporting on a unified dashboard that now not only facilitates
advertisers to get a drill down on their insights to the extent of 12 months, months, and days
but also offers a slice-and-cube technique to gain a competitive benefit over the market with
tendencies for your opposition. Gaining collective insights the usage of various tools to be
had inside the marketplace thru a single factor of get entry to allow you to to make decisions
quick, pass budgets and recognize how applicable customers inside the space have interaction
with other gamers.

Summary statistics
To study the behavioural pattern and mindset of young investor/ Future investors we have
conducted a study wherein we have targeted few aspects like the time period they are
investing in cryptocurrency, what app they use for investment, their opinion on legalizing
crypto, do they feel that the govt should add crypto as a subject in academics.
Findings
In this section there are three subsections that will be an explanation and discussion of
the problems that have been found in this study. The first subsection will discuss the
common problems of Cryptocurrency users in making transactions. The second subsection
will discuss data security by utilizing blockchain technology. The third subsection will
discuss the role of legal institutions in dealing with the era of the industrial revolution 4.0 in
the field of digital currency.
1. SQ1: What challenges will young Cryptocurrency users face while trading in
cryptocurrency?
Cryptocurrencies are qualitatively diverse, not interchangeable:
 The first issue that risk managers must deal with is the fact that cryptocurrencies are
fundamentally different and not interchangeable. The confusing array of cryptocurrencies
differs in a variety of ways, most notably in terms of security, programmability, and
governance. 
 
Simply put, there is no such thing as a "cheapest-to-deliver" coin. As a result, while
calculating, controlling, and monitoring risks, one must take into account the varied aspects
of different cryptocurrencies.

Cryptocurrencies need to face legal dilemmas:

 
Buyers and speculators are retaining a near eye on international activities as governments
respond to cryptocurrencies in a ramification of ways, starting from opposed to apathetic.

It is smooth to peer why crypto and Blockchain have taken more than a decade to adapt in an
environment in which they have needed to deal with troubles on the very coronary heart of
how our financial system and society work.
Digital currencies are virtual entities which might be decentralized. They're absolutely virtual
gadgets, and our government are unwell-ready to address such sophisticated era.
Cryptocurrencies are still developing technologies:
 Risk managers may not have the data they need to anticipate future bitcoin exposures and
hazards. 
Cryptocurrencies are very volatile and may be traded 24 hours a day, 7 days a week, all over
the world. Cryptocurrency marketplaces give a thorough but limited data set of real
transaction prices, which is insufficient for modelling purposes. In fact, because there is no
consensus on cryptocurrency pricing, return, or an equilibrium-generation function,
modelling and predicting these digital assets is similar to a guessing game.
Cryptocurrencies need to face trading costs:
 In contrast to everyday markets, the bitcoin marketplace is often much less liquid and extra
costly. Because the supply of many cryptocurrencies is constrained, with sparkling units
disbursed on a pre-determined agenda, it ought to come as no marvel that cryptocurrency
values are very risky.

The bitcoin marketplace is on occasion less liquid and more luxurious than conventional
marketplaces. It must come as no wonder that cryptocurrency values are extraordinarily risky
because the supply of many cryptocurrencies is restricted, with new devices released on a
pre-decided timetable.
Cryptocurrencies are still very risky:
 
Although blockchain is still in its infancy, it has grown to the point where it is more secure
than a regular computer system. 
 However, many financial breaches, data leaks, and massive losses as a result of system flaws
have made it difficult for individuals to be content with their transactions. 

2. SQ2: Is it possible to make sure that cryptocurrency doesn’t get hacked and any user
can transact upto their maximum limit?
Cryptocurrency ownership is tied to a token, or a protracted string of encrypted numbers, on a
blockchain. Each token is assigned a personal key, that is held with the aid of the proprietor
or custodian appointed through the proprietor. The token and wide variety itself might be
hacked, however it'd take years of attempts to achieve success because of the encryption
methods.
Whilst you ask knowledgeable humans approximately hacking the blockchain, a lot of them
will come up with one important exception to a blockchain community’s ironclad verified
ownership version.
It is called the 51% assault, and it works this way:
The integrity of community transactions is supported with the aid of the network of owners in
a given blockchain. So, for example, verifying Bitcoin ownership receives performed via the
consensus of the full community of Bitcoin proprietors, using the blockchain ledger.
With that in mind, if one party can get control of more than 50% of that possession, then all
sorts of things can be accomplished with blockchain transactions. The carrying out birthday
celebration of the 51% attack is the general public proprietor, so what they say is going.
In truth, it is very hard to execute a 51% assault. In a network of any size, it is prohibitively
high priced. Practically, no person goes to own 51% of Bitcoin or Ethereum or any of those
important blockchain property.
3. SQ3: Can Cryptocurrency affect the economy in India?
India’s inflation might be going down in the next few months, and the government has been
looking into how cryptocurrency might affect the economy.
What the Indian government needs to do is to allow its citizens to directly invest in
cryptocurrency assets legally through banking channels. The adoption of cryptocurrency will
give rise to new businesses, entrepreneurs, startups, products and services, and innovations,
or we can say it will give rise to a new market altogether. Just like it happened with the
internet, smartphones, and other new technologies such as AI, it is happening with blockchain
technology too in some countries like Singapore, Germany, and Switzerland. Just like other
countries are adopting crypto, the government of India should also let it flourish in the
country in a regulated manner.
If the Indian government gives its people access to invest in cryptocurrency through regulated
channels, it will help increase the purchasing power of the 1.3 billion population. The present
per capita income of India is just over $2,000, which is significantly lower when compared to
other developed countries. Also, the doors of global high-performing markets are closed to
average retail investors, so they have limited options in India’s equities and commodities
markets.
The growth of blockchain technology will give rise to multiple companies. When the Indian
government starts regulating Bitcoin and other crypto assets, there will be a lot of significant
innovation, creating a plethora of crypto-related jobs in technological engineering, marketing,
and many more.
4. SQ4: Will cryptocurrency completely replace physical currency and be part of
people’s daily life?
There is no doubt that digital currency is the future. High chance that by the end of this
decade, physical wallets will extinct, and you will store money on your smartphones but, that
money is unlikely to be just crypto. There are governments that are trying to work on their
own digital money, including India. There have been reports of RBI introducing a digital
rupee in near future, and it has better odds of outlasting cryptocurrencies.
The effects a complete replacement of fiat currency would have been still being explored and
evaluated. There could be significant adverse impacts on economic and financial stability, or
the change could usher in an era of complete global stability.
The International Monetary Fund (IMF) recommends against adopting cryptocurrency as a
main national currency in its current state due to price volatility
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