Zerodha's Nithin Kamath: Don't invest in Bitcoin because I don't understand it, maybe Elon Musk knew what was happening in China

"Personally I don't understand Bitcoin as an asset class so I don't invest in it. I don't know what it is solving for. The only reason to buy Bitcoin today is the hope that someone will buy it from you at a higher cost" he said.

Various reasons have been attributed to the crash in cryptocurrencies this week - Elon Musk's I Love You- I Love You not approach towards Bitcoin, China's ban on financial and payment institutions from providing crypto-related services and warning to investors against speculative crypto trading, with some experts stating that a fall was directionally on the cards after a spectacular rally in the last year.

India too is at a crucial juncture in the way it treats crypto. While the Government and the RBI have historically had an adverse view, there have been signs in recent months of a change of heart. While the Government may still not accept crypto as a currency, it may be allowed as a regulated asset class. The crypto industry too has sought regulation instead of a blanket ban in their recent submissions to Government officials and regulators.

Will Zerodha offer crypto on its platform if the regulators allow it? "If regulations allow it explicitly, of course, we will do it. It is a no-brainer. But how can the Govt regulate something where the whole attraction is decentralization? Once you buy crypto you can do anything, it is not like a stock that sits in a Demat account under the jurisdiction of the Indian Govt," Kamath said.

He was also skeptical of the utility of blockchain in the way stock exchanges function. "Talk of blockchain has been happening for 4-5years. What is the use case in primary markets? If there is one, someone would have used it by now."