Why rich Indians invested in cryptocurrencies, NFTs last year?

Due to the surge in popularity of cryptocurrencies and NFTs, about 20% of India’s ultra-net-worth individuals (UHNWI) have invested in crypto assets over the past year, according to a Knight Frank report. UHNWI is a person with a net worth of over US $ 30 million (about 226 rupees).

Knight Frank said in a wealth report released Tuesday that 18% of the world’s UHNWIs currently own cryptocurrencies or tokens and 11% are investing in non-fungible tokens (NFTs).

In India, 18% of the ultra-rich are investing in crypto assets. Of this, 10% is invested in cryptocurrencies/tokens and 8% is invested in NFTs.

In 2018, when the Wealth Report first investigated the potential components of blockchain, cryptocurrencies, and NFTs, one-third of survey respondents suspected that customers hadn’t even heard about them and just 14 per cent reckoned that blockchains would significantly influence how wealth was managed.

2021 was the year when crypto investment became mainstream. The growth of this sector was certainly breathtaking. According to Economist magazine, the global value of crypto assets at the end of 2021 was $ 2.4 trillion, a 12-fold increase from the beginning of 2020.

Currently, there are more than 8,000 cryptocurrencies that investors can choose from and countless NFTs in circulation.

One-third of respondents said security concerns were behind investment resistance. However, the biggest obstacle cited by more than 60% is that UHNWI does not yet fully understand the market and is not confident enough to enter.

Volatility is also a major concern, but this is the main attraction of many traders.