Dear Editor,
I read with interest the Opinion on Economic Affairs, “Lessons from the crypto carnage” (ST, July 13).
Today, most people in Singapore especially the young generation have felt the soaring cost-of-living pressures which are due to the highly competitive working environment, variability or dynamic challenges of the employment, the pace of wage increase is generally slower than expected and high inflation.
In recent months, Singaporeans have been grappling with rising prices and these caused everyone to tighten their belts and think of alternatives – cut expenses and increase or diversify sources of income.
In due course, some rich people and youngsters who have better income think of putting their investment in cryptocurrency, as they think crypto assets could be a good condition to preserve investment portfolio as it is highly profitable.
However, anyone who wishes to buy cryptocurrency must ensure that you have done enough research and reading to understand the mechanics of the crypto that you’re buying into. Also, ensure that you can afford to risk that portion of your disposable income (without affecting your family’s financial stability).
As cryptocurrencies are often high-risk and volatile in nature. Basically, there are three disadvantages. For examples,
1 A significant regulation that hit the cryptocurrency market hard was China’s crackdown on Bitcoin mining, a ban on crypto exchanges, and crypto payment methods in May 2021.
2 it is possible for your personal identity to be exposed within the cryptocurrency community. For example, your crypto transaction details can be matched to real-world information to identify you (especially if you have made multiple crypto transactions).
3 Likely orchestrated hacks by a malicious group of miners. They can modify, invalidate, and even reverse legitimate transactions so they can double-spend the cryptocurrencies and coins involved. For example, a 51 Attack affected Bitcoin SV (BSV) recently in August 2021.
Lately, two of my close friends have lost S$30K and S$50K respectively due to their investment in the collapse crypto hedge fund Luna and Three Arrow capital (3AC).
Teo Kueh Liang (Mr)