Bitcoin, Ethereum, or Altcoins? How investors create their encryption portfolios, explain Avinash Shekhar

With Bitcoin is often considered “digital gold”, ETHEREUM is running the ecosystem for decentralized financing (Defi), and an increased list of Altcoins that provide high -risk and high control opportunities, the options are vast.

In an insightful conversation with KSHITIG Anand from Etmarkets, Avinash Shekhar, co-founder and CEO, PI42 dismantling how different types of investors-long-term and speculators and those who seek to obtain various strategies-specialize in encryption investments.

It also highlights the concerned risks and the main factors that must be taken into account when moving in this dynamic market. Excerpts edited –

KSHITIG Anand: I am sure that when I started exploring the encryption scene, I noticed many factors that lead traditional investors from stocks, real estate and commodities in the encryption market. What are these factors in playing today?

Avinash Shekhar: There are two types of investors or traders who explore the encryption market on a large scale. One group of investors who understand that Crypto is an innovation of our generation – well for how to build the Internet infrastructure.

These investors see coded as a long -term growth engine and they were investing for a very long time. They usually focus on assets like Bitcoin, Ethereum and Solana, with a long -term investment approach.

The second group of investors is more guess. The encryption markets are historically volatile and operate around the clock throughout the week, making it attractive to technical merchants. These traders participate in trading chick and artistic trading, not only in Bitcoin and Ethereum but also in a wide range of Altcoins.

KSHITIG Anand: In a previous conversation, I mentioned that Crypto is one of the assets of one of the assets where retailers entered first. Now, founding investors also join the vehicle. What does data indicate about modern trends, and how do you expect things to form in the near future?
Avinash Shekhar: If you look at the trends of the modern market, for one year to a year and a half, the founding investors began to invest heavily on encryption. For example, Microstrategy has made significant investments, and the approval of the Bitcoin investment funds in Bitcoin attracted about $ 36 billion in investments.

I think institutional investors will now push growth, which may lead to a decrease in the fluctuations in the long -term encryption. Although encryption remains much more volatile than traditional markets, I expect a declining trend in volatility over time.

Despite the unfavorable organizational environment in India, about 40 million Indian have been circulated or invested in encryption in the past few years. To move forward, I expect to increase organizational clarity, which will have a positive impact on encryption investments.

KSHITIG Anand: Actually, can you also give us some perspective about the advantages that Crypto offers on traditional assets such as stocks, gold and real estate? I have already mentioned that about 40 million Indian investors have invested in Crypto, and I am sure that in the coming years, this number will only increase instead of decline. The regulations seem to settle and tend towards a more positive bias instead of negative bias.
Avinash Shekhar: If you compare market encryption, gold, or real estate markets, one major advantage is that the encryption markets are very liquid. Gold, especially in the form of jewelry, real estate is not liquid assets, while the stock market is.

Another discrimination is that, as we previously discussed, Crypto is truly the technique of our time. While the risks are higher, potential rewards are also great. There is a certain group of investors who want to invest in new technology and carry higher risks for a possible higher returns.

In addition, bitcoin is often compared, in particular, with gold, sometimes referred to as “digital gold”. However, it provides great advantages on material gold – it can be transferred in any part, at any time, to anyone. The ability to transfer it and ease of use is much larger than gold, and it cannot be fake.

While Crypto shares some similarities with traditional assets, it is a completely new group of investment.

Investing in encryption is mainly invested in future technology with huge potential in the upward trend, albeit with the risks associated with it. Any new technology that carries the possibility of failure or challenges.

The encryption market is also not a teller – it includes firm assets like Bitcoin, Ethereum and Solana, as well as emerging projects that use artificial intelligence and Blockchain technology.

While Bitcoin potential rewards are moderate to high with relatively less risk, newer technologies provide higher possible but also higher risk.

KSHITIG Anand: But let’s also understand why investors purchase encryption at this stage. Do you see them dealing with encryption as hedging, similar to gold, or as a highly developed speculation? How do they approach encryption investments?
Avinash Shekhar: It is actually both. Some investors look at Crypto as a high -growth alternative to gold. These investors usually take a long -term approach, investing in assets like Bitcoin and Ethereum and their contract for long periods.

On the other hand, there are merchants that speculate in the encryption markets. If you analyze market sizes, most of the activity is driven by traders, who play an important role in discovering prices.

These merchants, or speculators are interested in short -term market movements. As we discussed previously, technical analysis tends to work well in the encryption markets, making it attractive for short -term speculation.

Now, we are also witnessing the emergence of a third group of investors-those who invest in the backed by the real world’s assets. This approach combines the traditional Web2 space and the ecosystem of the decentralized Web3, which combines the best in the two worlds.

For example, a drug in Singapore can be symbolic, allowing investors to own a small part of it through symbols. This means that they have an indirect part of the building and they can participate in any value.

These types of use expand, as Blockchain and Crypto technology works as a way to transactions in real business.

KSHITIG Anand: In fact, we have seen this trend where new currencies are added frequently. I will not say on a daily basis, but certainly often. How do traditional investors create their encryption portfolios? Do they focus on bitcoin, altcoins or various strategies? What trends do you watch at the end of you?
Avinash Shekhar: First of all, a large number of new coins that are offered to be of accurate audit requires. Investors should be very careful about whether the project is original or just a plan for the pump and discharge. It is necessary for people to conduct their own research instead of following advice and investing blindly.

However, when it comes to real projects-which are working on a specialized team that creates a change in the ecosystems-traditional investors, especially the long-term investors who are looking to diversify their portfolios, are more dependent towards Bitcoin and Ethereum.

Meanwhile, merchants and speculators aim to make short -term gains more inclined towards Altcoins. However, it is not always an approach or approach.

Some investors maintain a mixture, allocate, for example, 60 % of Bitcoin, Ethereum and 40 % to Altcoins. These two groups represent different ends of the investor spectrum.

KSHITIG Anand: What are the common risk management techniques that investors enter the encryption space? Can you highlight each other?
Avinash Shekhar: The first thing to understand is that Crypto is still one of the very volatile origins, especially altcoins, which suffers from severe fluctuations. It is often said that the fluctuation is a merchant friend, but this is only true if you manage your money correctly.

For example, when making an investment in encryption, you should allocate a certain percentage of your investment wealth – to a 100 % calm. It is recommended to start a small part, such as 5 % to 10 %. Even within this allocation, do not put everything in one of the assets.

If you plan to trade in Altcoins or engage in daily trading, allocate only 2-3 % or at least 5 % of your encryption portfolio for one trade. In this way, even if you lose this money, you still keep 95 % of Malik’s head. Diversification is crucial, even within encryption, unless you are investing only in bitcoin.

Second, always use suspended losses. Looking at high fluctuations, many merchants have put both the level of seizure of both profit and stop level when entering the trade. This is because prices can rise and then decrease quickly.

Putting each of the levels of profit and losing stopping to manage deals more effectively and prevents large losses. The main principle is to avoid losing each owner’s head in one trade.

If you have a long -term perspective and an investment plans over time, the traditional strategy of average cost in dollars (DCA) is valid. For example, if you have $ 5.00,000 to invest in Bitcoin, do not invest everything in one day. Instead, publish it – perhaps $ 50,000 or $ 1.00,000 per month – based on your risk file. This approach helps reduce the impact of market fluctuations and provides a more organized investment strategy, even in the encryption market.

KSHITIG Anand: Also allow me to get your point of view on whether traditional investors prefer direct encryption investments or if they choose circulating investment funds, derivatives or Blockchain -based financial tools. How do they invest? Did this trend change?
Avinash Shekhar: It is a mixture. Individual investors continue to invest significantly. A survey indicated that about 60 % of individuals invest directly, which may be a job for available opportunities. If you look at the circulating investment funds and similar tools, they are not accessible to a large scale – only a few countries, such as the United States, are offered.

If these opportunities become more prevalent, the percentage of individuals who invest directly may decrease.

As of now, about 60-65 % of individuals invest directly. However, as soon as the appropriate regulations and people feel more comfortable, they may start investing through the traded investment funds.

In particular, investment funds can be useful because, for the regular retail investor, the encryption nursery management is not easy. Most people retain exchanges, which are vulnerable to piracy. In this context, circulating investment funds become a safer option.

KSHITIG Anand: I mentioned that cryptocurrencies are still volatile. Although this is the case, what are the main concerns that investors have when diversifying in this field?
Avinash Shekhar: The main anxiety is fluctuation, although we see it gradually decreasing over time. Therefore, while fluctuation is still a factor, its effect reduces the maturity of the market.

The second main attention, especially in the Indian context, is taxes. Crypto taxes are imposed in India, unlike most other countries, which encourage investors to enter the area.

The third attention is related to regulations. While Crypto is completely legal in India, there is still confusion among the general public. Many people mistakenly believe that it is illegal. Unless there are clear positive regulations as the government encourages instead of encouraging this new technology, the adoption will remain slow.

In my view, the investment is just one aspect of encryption – not even the most important aspect. The real value lies in innovation, as people build new technologies and create solutions in the Web3 space. However, due to the lack of regulatory clarity, innovation either does not happen or is led outside India.

The real challenge is to support entrepreneurs, engineers and innovators who want to build in the WEB3 space but are not sure of the legal framework. They need clear guidelines about whether their work is allowed, and what are the regulations that apply, and how they can follow. This, in my opinion, is much more important than the investment side.

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