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Bitcoin Hits Record High crossed $15,000 Mark on Thursday

Author: Debasis Mohapatra/Friday, December 8, 2017/Categories: Currency

Bitcoin Hits Record High crossed $15,000 Mark on Thursday

Mumbai, December 7 - Ahead of the launch of Bitcoin futures trading in some of the US-based exchanges, the cryptocurrency has crossed $15,000 mark on December 7. This is the steepest rise of the virtual currency, which has jumped 1,400% so far in 2017 from sub $1,000 level at the beginning of the year.

Market analysts are of the opinion that rise of demand is driving the price of bitcoin all time high. But, such meteoric rise is largely unseen in any other asset class, making it a risky proposition for investment purposes. Further, the virtual currency is devoid of any underlying asset.

Given the risks attached to this form of investment, The Reserve Bank of India (RBI) on Wednesday again warned the general public to stay away from this cryptocurrency. “In the wake of significant spurt in the valuation of many VCs and rapid growth in Initial Coin Offerings (ICOs), RBI reiterates the concerns (on bitcoin)," the central bank said on Wednesday.

RBI in a note in 2013 had said that there was no underlying or backing of any asset for virtual currency like bitcoin. “Users are exposed to potential losses on account of volatility in value of VCs,” it had warned.

“Investors should not put their money in digital currency like bitcoin as RBI strictly warns general public not to invest in such product. Also, high volatility seen in recent days in bitcoin will put capital invested by individuals under risk,” Shantanu Awasthi, Head (Products, Family Officer & International Business) of Karvy Private Wealth told The Finapolis on Thursday.

Meanwhile, investment advisors also said sheer greed is driving bitcoin price all time high. “For last two-three days, we are getting a lot of enquiries from our clients regarding bitcoin. Our answer to them is as nobody understands the product and nobody regulates the product, investment in bitcoin becomes risky,” Melvin Joseph, Founder of Mumbai-based advisory firm, Finvin Financial Planners said.

He also said when a product is operating in regulatory vacuum, an investor has nowhere to go in case of capital erosion. “It’s sheer greed which is driving the market as investors think they shouldn’t miss the money making opportunity. But, they are better off to miss the bus in case of bitcoin,” Joseph added.  

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