Unocoin offers a systematic Buying Plan to buy BTC or ETH every day, every week or every month for a specific amount with INR.
In September 2017, when I first bought BTC, the exchange I used was Unocoin. Soon after, I had setup a Systematic buying plan to buy BTC worth Rs. 100 everyday. Unocoin was the first exchange in India to offer an SIP like service to buy Bitcoin, the second one is Bitdroplet by Bitbns exchange. Bitdroplet however offers the service with USDT.
I decided to try Unocoin SBP again last week. Unocoin now offers the SBP for both Bitcoin and Ethereum. I started an SBP of Rs. 1000 per day for Bitcoin and Rs. 250 per day for Ethereum.
How to Start an SBP on Unocoin
Unocoin Exchange offers only three Cryptocurrencies, BTC, ETH and USDT and is a closed orderbook exchange. Another product by Unocoin called Unodax offers trading in multiple cryptocurrencies and is an open orderbook exchange. The SBP service is available on the Unocoin App.
Follow these simple steps to start an SBP
- Go to Settings and click on “Systematic Buying Plan (SBP)”
- Choose the Cryptocurrency for SBP – Bitcoin or Ether.
- Choose the frequency of investment – Daily, Weekly or Monthly
- Enter the amount to be invested.
- Click on SBP Enable to start the plan.
Although the app says the crypto is purchased at 00:00 hours, we have observed the buy orders are placed for BTC at 00:00 hours and ETH at 00:07 hours everyday (if daily SBP) or on the day/date chosen for weekly or monthly SBP.
Is Buying Crypto with SBP Profitable?
Bitcoin is considered to be the king of cryptocurrencies and still holds huge market dominance. However, the price of Bitcoin is highly volatile, thereby making it a high risk investment compared to Mutual Funds and other traditional investments.
It is important to be able to benefit from the volatility and also to reduce the risk that comes with it.
Investing in SIP enables an investor to take part in the Bitcoin markets without actively timing them and they can benefit by buying more crypto when the price falls and less when the price rises. This scheme helps reduce the average cost per unit of investment through a method called Rupee Cost Averaging/Dollar Cost Averaging. We have seen it work in the past.
A person invests Rs 50000 for ten months in SBP/SIP. We will find out that the actual average purchase cost of BTC would be lower than the average NAV of their investment over 10 months, which is the key benefit of Rupee Cost Averaging. Actual average purchase cost as per SBP = (50000 * 10)/ (total BTC purchased 0.5658) = 883704
Profits cannot be guaranteed with SBP, however the buying cost of crypto averages out if the purchase is spread across different prices.
Unocoin Systematic Buying Plan Review
Unocoin SBP is pretty straightforward, however the price of BTC on Unocoin is generally slightly higher than the market average. For instance, the current Buy Price on Unodax is ~910000 INR but it is ~920000 INR on Unocoin.
I would choose to invest using Unocoin SBP simply for the convenience of it.
The SBP can be started in a minute once you have deposited INR into the exchange and can be disabled at any time. The BTC purchased can be sent out, sold or even used to buy gift vouchers from the app itself.
Moreover Unocoin offers users the ability to create their own paper wallets. So users can simply move the funds out to the non custodian wallet and keep it stored safely. I personally wouldn’t recommend this step until you fully understand how Bitcoin Blockchain works. However, I do recommend moving the funds out of the exchange and into a private wallet once it is of significant value.
If you are willing to pay a small premium on BTC and ETH price, Unocoin is a good solution for starting and SBP with INR directly. On the other hand, products like Bitdroplet offer the same service for BTC using USDT, and the price of BTC is generally the same as market price.
To get started with Unocoin you can visit https://unocoin.com, sign up and use U-435001 referral code.
What do you think about Unocoin’s SBP? Let us know in the comments below.