It wasn’t long ago that the handling of cryptocurrencies with a budget of 2022 effectively broke the industry deeply. Anticipating the key consequences from tax decisions on virtual assets, more than half of interested investors are friendly to other cryptos such as Dubai, Singapore and even Thailand to impose such high taxes. I believed it was as good as driving the crypto business to the arm of the country. Many were afraid that a large tax on this sector could operate secretly and transfer future creative Layer 2 products to other countries.
It is a mistake to say that such concerns have subsided since February 1, when India’s Finance Minister Nirmala Sisaraman first proposed a flat rate of 30% on income from virtual assets without exclusions or deductions. is. The debate is still intensifying. Due to the diversification of investors, there is still a great deal of turmoil in the market as to whether or not to join the new era of asset classes, especially given the excessive volatility of crypto tokens.
I think the cryptocurrency market will expand even if the tax rate rises.
Cryptographic tax is the first step towards cryptographic regulation
Clarity in the taxation process turns out to be an important first regulatory step towards broader recruitment when the involvement of individuals who were on the sidelines for the 2018 outlawing is ultimately at the forefront. increase.
Taxes are high, but cryptocurrency transactions are more transparent than before. This transparency undoubtedly supports the investor’s quantitative decision-making process, providing the structure and stability that is highly needed for crypto portfolios. In other words, at this point, positive action from the government must be taken against the chin.
In addition, investors can benefit from holding crypto as a result of their budget statement. The budget declaration raises the importance of virtual assets to new levels for investors, and more investors are demanding diversified investment. For private investors, it’s a great opportunity to start their Bitcoin journey. So the bigger question is not whether or not to invest, but how to invest.
Instead, how to invest
Cryptographic investment strategies should now be a priority in the minds of investors.
Investing is a very personal choice and, apart from the fact that each investor has its own investment philosophy, duration and risk tolerance, investors have made significant portfolio readjustments after the tax has been implemented. Does not seem to require. For now, existing investors can continue with their previous approach, but it is safest for new investors to invest in “good” crypto coins, especially in the face of the recent Terra LUNA crash.
As long as investors focus on stable themes and solid sectors, their long-term strategy does not need to be modified at all. So, of course, it’s not good news for day traders looking to profit from very short-term price fluctuations, but at this point, SIP models or measured investment strategies are the best bet for investors. When it comes to protecting investors from dangerous market volatility, small amounts invested over time are most effective.
So, yes, cryptocurrencies can be tricky and taxy, but higher returns are still possible as long as investors look at them in the long run, do some research and focus on future trends.
(Andesh Bhatti is an angel investor and founder of the Collectcent-Supply Side Advertising Platform. The view is personal.)
Published: Sunday, May 22, 2022 9:51 pm IST