The third-largest cryptocurrency exchange in the world, FTX, went down, shaking the market for digital assets to its core. But the most important concern is: How significantly has it affected Indian investors?
Given the modest exposure of Indian cryptocurrency investors, many would estimate the impact to be minimal. However, the fickle market for crypto assets and the unsettling events nearby have already cost more than 2 million people about INR 1,50,000 Cr.
Given that FTX appears to have parked a significant number of outside assets, the damage could be greater this time.
What was FTX?
FTX is a centralized cryptocurrency exchange platform that supports several different coins.
India moving towards self-regulation
Since 2017, the Reserve Bank of India (RBI) has issued a number of announcements informing the public that cryptocurrencies aren’t accepted as money and cautioning them about the dangerous nature of investing in cryptocurrencies.
By coincidence, the Indian Internet and Mobile Association (IAMA) and the cryptocurrency industry established the Blockchain and Crypto Assets Council (BACC) as a lobbying group (IAMAI).
Moving toward self-regulation was the plan in order to increase consumer awareness and transparency. However, the internet lobby dismantled BACC in July 2022, citing a hazy regulatory landscape. According to reports, BACC officials were not consulted before making the choice.
However, considering the disastrous episodes that have occurred in bitcoin exchanges, the majority of stakeholders believe that a regulatory framework is unquestionably needed in India’s digital asset ecosystem to promote consumer protection and transparency.
They also think that increasing investor knowledge is an important factor that needs to be taken care of right away.
“The Indian rupee (INR) will first be used in international trade instead of the USD and other major fiat currencies in the nations of Sri Lanka, Mauritius, and Russia.
To simplify rupee trades with Russian counterparts, the Reserve Bank of India (RBI) has authorized the opening of 12 Vostro accounts in Indian financial institutions.
Additional Vostro accounts have already been authorized; five of them will be utilized to transact in rupees with Mauritius and Sri Lanka.
The Post-API Surge: The Demise
Everything appears to be a nail when all you have is a hammer. This was the case for us in India. Covid, the possibility of working from home, and the booming markets all encouraged the use of APIs in trading.
Anyone who knew how to code could automate the execution of buy and sell orders.
Consequently, the number of third-party automated trading providers increased.
Everyone wanted a piece of the action, which only led to the emergence of unregulated platforms with their inventive claims of outperforming the market and generating astronomical returns. More and more uncontrolled sites came into view.
This involves some risk for both the investor and the exchange. Freak orders could affect the exchange’s operation, and as investors, you might lose more money than anticipated.
What does the future hold for Algo trading?
This is only the beginning. Despite this, API-based trading and goods are here to stay because they allow for a lot of innovation in the financial technology sector.
Some business veterans have voiced concern that the guidelines for using Trading APIs and Algos after the prior year’s discussion paper shouldn’t exclude or make it exceedingly difficult for retail consumers who have programming skills to utilize APIs for domestic use, risking them suffering collateral damage.
Conclusion
Choosing the best cryptocurrency exchange for your needs and your objectives involves some research because they are sophisticated.
Setting up a digital wallet and being aware of the sort of crypto you intend to trade is helpful. Not every type of cryptocurrency is offered on all exchanges.
You should also think about whether or not the exchange works in your specific region, the fee structure, general security, and how simple the exchange is to use when selecting a cryptocurrency exchange.
There are many factors to consider, but keep in mind that your assets and finances are on the line, so selecting the right platform does require considerable time and attention.
Same as you would do prior to embarking on a business travel trip, you would very likely make use of a review platform as an additional method to make sure you find the best available resources when you get there.
You must do the same prior to starting investing in cryptocurrencies, check out as many review platforms for trading bots as you can. You may quickly and securely create an Active Invest account, add your cryptocurrency account from there, and begin trading!
