SIPs are a good way to understand the investment market.The rise of cryptocurrency has led to a flourishing industry in India.
An increasing number of new investors are joining the industry, seeing in it a promise to grow their wealth rapidly.
Also, the trading is less complex for the young professionals, who understand technology far more intimately.Cryptocurrency exchanges, too, find it less taxing to deal with them, compared to other sectors.
Emboldened by their initial success, these exchanges are now gearing up to test the waters beyond just trading services to include lending, fixed deposit and SIPs.Crypto lendingThis service allows users to obtain cash by depositing part of their crypto assets to the exchange as security, without the need to sell them.
The amount of cash received depends on the current value of the asset and the lending rate.
A crucial benefit of crypto lending is traders can expect the value of their asset to increase during the time they keep it deposited with an exchange.Fixed depositsUsing the same method, lenders can also deposit their crypto assets for a fixed term, instead of an open term as in lending.Systematic Investment Plans (SIPs)SIPs are a good way to understand the investment market.
It enables an investor to get a better entry price in a volatile asset by making regular and timed purchases.
This investment strategy is usually preferred by patient investors who want to avoid any kind of impulsive decision and like to remain guarded.
An investor has to make a regular, predefined investment, which can be as little as Rs 100, and the deposit will grow.
At the end of the term, they get returns according to the interest rate and market price of the asset.However, it is important to note that the cryptocurrency industry is highly volatile and behaves in unexpected ways.
These additional services that the crypto exchanges are launching are aimed at taping those who are wary of the risks involved in crypto markets.
But services like SIP and lending are a way to minimize those risks.