2020 and 2021 have been unusual years, not only for medical sciences but also for
the world economy. A financial instrument that gained a huge momentum recently is
cryptocurrency. This research paper analyses the mass hysteria that has developed
among the Indian population, especially during March and April of 2021. As we take
lessons from previous financial crisis, like 2008 Housing Bubble and the 1637 Tulip
Bubble, cryptocurrency bubble seems like a plausible event. Poignant factors
contributing to this bubble speculation are misinformation, asymmetric information,
herding behavior, and disposition effect. The Kindleberger-Minsky model has been the
basis for observing this behaviour. This model talks about the common pattern in
financial bubble formation and the paper explains how relevant it is today in the Indian
cryptocurrency market. Primary data from the Indian population has been collected to
show the existence of asymmetric and misinformation. The final part of the research
paper talks about the regulation of cryptocurrency. A number of recommendations
have been presented to curb this potential financial threat to the economy.