Mark Mobius, a global markets veteran, sounded an alarm bell for investors as markets around the world rebounded from the covid lows, largely riding on a gush of liquidity. According to Mobius, founder of Mobius Capital, the spectacular increase in cryptocurrency trading and stock markets are associated, and any sell-off in the new asset could lead to a crash in equities.
“Many people have become wealthy as a result of their cryptocurrency investments. It’s possible that it’s not real money. Nonetheless, as long as the crypto market increases, stock markets will rise, and if it begins to fall, stock markets will crash,” Mobius said in a fireside chat at a UTI mutual fund gathering.
According to Mobius, a drop in cryptocurrency would affect the entire stock market, not only technology stocks. He was taken aback by the explosion of cryptocurrency trading. He added, “However, it has produced several multi-billionaires.”
In the last year, famous cryptocurrencies such as Bitcoin, Ethereum, and Ripple have exploded in value.
Bitcoin has gained 800 percent since March 2020, while Ethereum has gained 1,242 percent.
In comparison, the Indian benchmark index Sensex has increased by over 78 percent since March, while gold prices have increased by 10%.
With the rise in popularity of cryptocurrencies, Tesla purchased $1.5 billion worth of Bitcoin in February, boosting its value and piqued investor interest.
Elon Musk, Tesla’s CEO, has made some recent social media posts that are commonly thought to be boosting the prices of cryptocurrencies like Bitcoin and Dogecoin.
Overall, Mobius remained bullish about Indian stocks, believing that government reforms are benefiting the economy.
“India continues to be the market leader, despite China’s rapid rise. China, like the United States, is transitioning from an export-driven to a consumer-driven economy. India, on the other hand, is heading toward a more export-driven economy, according to Mobius.
