Whalesbook
Indian crypto investors are increasingly using Systematic Investment Plans (SIPs) to build long-term portfolios, with one major platform reporting a 220% jump in sign-ups. While this strategy helps in averaging out volatile costs, digital assets remain high-risk and are taxed differently than regulated financial instruments like mutual funds.
What Happened
A growing number of Indian investors are adopting Systematic Investment Plans (SIPs) for cryptocurrencies, signaling a change from speculative trading to a more structured, long-term approach. According to the "How India Trades Crypto 2026" report by the platform Mudrex, crypto SIP openings on their platform surged by over 220% during 2025.
The report, which surveyed 6,000 active participants, indicates that nearly 41.2% of users now identify as long-term "buy-and-hold" investors. Furthermore, a significant majority of these investors allocate only a small portion—less than 25%—of their total portfolio to digital assets, suggesting a more cautious approach to risk management compared to previous years.
Why Investors Are Adopting SIPs
Historically, SIPs have been a cornerstone of Indian mutual fund investing, known for instilling financial discipline. Applying this model to crypto, investors are moving away from trying to "time the market"—a difficult feat in a highly volatile asset class. By investing a fixed amount at regular intervals, investors use a strategy known as rupee cost averaging. This can reduce the impact of sharp price swings, as they buy more units when prices are low and fewer when prices are high.
For many, the lower entry barrier of SIPs makes the crypto market more accessible, allowing individuals to invest smaller, manageable monthly sums rather than committing large amounts of capital at once. This behavioral shift aims to remove the emotional stress of watching daily price charts, which is common in active trading.
Important Considerations For Investors
While the adoption of a disciplined investment strategy is a positive behavioral change, investors should remain aware of the unique risks associated with digital assets in India. Unlike mutual funds or stocks, which operate within a well-defined regulatory framework overseen by SEBI, the crypto sector does not currently have a similar level of investor protection or oversight.
Investors must also account for the tax implications. In India, gains from the transfer of Virtual Digital Assets (VDAs) are subject to a specific tax regime, which includes a 30% tax on income from such transfers, along with a 1% Tax Deducted at Source (TDS) on payments made for the transfer. These costs can significantly impact net returns. Additionally, because crypto prices are not tied to company fundamentals or earnings, they are prone to extreme volatility, and there is no guarantee of value recovery, unlike established asset classes.
What To Track Next
For those looking at this space, the regulatory environment is the most important factor to monitor. The industry continues to engage with policymakers regarding clearer definitions and oversight for digital assets. Investors should track any updates regarding taxation, exchange security standards, and global regulatory trends that could influence the domestic market. It is also crucial to ensure that any platform used for SIPs has robust security practices to protect against operational risks.
