Indodax emphasises risk management to anticipate impact of global conflict

Jakarta (ANTARA) – Domestic cryptocurrency market participants, Indodax, say that amid current global geopolitical dynamics, rigorous risk management discipline is essential for crypto asset investors. Vice President of Indodax, Antony Kusuma, in a statement received in Jakarta on Wednesday, said that the escalation of conflict in the Middle East since the US-Israel tensions toward Iran on Saturday (28 Feb) has impacted the world crypto market, including volatility in the digital currency Bitcoin. Based on CoinMarketCap data, he continued, Bitcoin briefly corrected to USD 63,100 at the weekend, then surged to USD 70,000 at the start of the week, and is now trading around USD 68,000, with the global crypto market capitalisation around USD 2.33 trillion. The 24/7 nature of crypto markets makes them among the most responsive indicators of changes in investor sentiment. “Discipline in risk management and having a long-term investment perspective remain the key to staying rational and adaptable in the face of global uncertainty,” he said. He noted that the high volatility of crypto assets reflects the market’s high sensitivity to geopolitical developments and macro risks. The surges and corrections within days indicate the market is very headline-driven, he continued. In such situations, global sentiment and policy dynamics are the main factors shaping movements of risk assets, including equities and crypto. In the early phase of turmoil, investors generally adopt a risk-off stance to preserve liquidity. If the uncertainty persists, some investors consider more defensive assets. Antony said investors should avoid decisions based on fear of missing out (FOMO) or following the crowd, and applying portfolio diversification and disciplined risk management are the most rational steps. In unsettled market conditions, he added, portfolio diversification is one of the approaches many adopt, including shifting some exposure to more stable crypto assets such as stablecoins like Tether (USDT) or USD Coin (USDC), or gold-backed crypto assets like Tether Gold (XAUT), which has been strengthening, while still maintaining measured allocations to core assets. In parallel, he said the company remains committed to maintaining liquidity, system security, and transparency, while strengthening risk education. He said they continue to educate members to remain rational amid market volatility, and encourage investors to always do their own research and maintain strict risk management. “During periods of macro headwinds as intense as they are now, staged investment strategies or Dollar Cost Averaging (DCA) remain the wisest option to mitigate volatility,” Antony said.