Nitin Kamath, founder and CEO of online stock brokerage firm Zerodha, is known for frequently sharing interesting information and advice on the social media platform Twitter. In his recent tweet, he highlighted the tendency of celebrities to motivate investors to invest in super risky asset classes without talking about risk.
Kamat tweeted, “Seeing celebrities with huge fan followings trying to inspire their fans or retail investors to invest in the super risk asset class without talking about the risks, or the risks of those who follow them It’s disgusting enough to care about profiles.”
Relating the same to crypto hype, Kamath said, “Thank you cryptoOf course, it has been a case of “never meet your heroes”, with so many people I admire peddling crypto, NFTs, etc. as safe and guaranteed. Nothing against crypto, it would have been the same as stocks or even AAA-rated loans. Being safe and guaranteed was pedaled.”
NFTs are digital assets that represent a wide range of unique tangible and intangible items, from collectible sports cards to virtual real estate and even digital sneakers. Over the past year many celebrities have come up with their own NFT collections.
Renowned for volatility, cryptocurrencies have gained attention as an asset class over the past few years and have gone mainstream on the back of their sharp rally despite uncertainties around regulations in several countries, including India.
Cryptocurrency prices went on another roller coaster last year, rising, falling and then cycling again. El Salvador this year became the first country to make bitcoin legal tender, while the first exchange-traded fund (ETF) linked to bitcoin futures also began trading.
The recent volatility in cryptocurrencies comes during a volatile period for the financial markets. Rising inflation is forcing central banks to tighten monetary policy, threatening to ease the liquidity tailwind that has lifted a wide range of assets.
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