India is a cryptocurrency bigwig in Asia. Despite the government’s efforts to shut down the cryptocurrency market in India, Bitcoin has continued to thrive as crypto enthusiasts remain relentless.
This article looks at Bitcoin’s legal status in India, its popularity, and how to buy Bitcoin in India right now.
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Is Bitcoin (BTC) Trading Legal in India?
The Indian Government doesn’t fully back Bitcoin trading legally. It doesn’t prohibit it either. Therefore, as of now, we can absolutely say Bitcoin trading is legal in India. However, we don’t know how long this ‘legality’ will last because the government has been issuing constant threats of a possible ban on cryptocurrencies.
In 2018, banks were banned from facilitating transactions on cryptocurrency exchanges, which demoralized many crypto investors. However, in early 2020, the Supreme Court overturned this decision, which skyrocketed Bitcoin trading and saw an increase in overall transactions.
The Minister of Finance in India, Nirmala Sitharaman, has said that the government doesn’t consider cryptocurrencies as legal tender. Therefore, it intends to ban and eliminate cryptocurrencies their use.
Bitcoin & Crypto Trading in India
Indian crypto investors seem unmoved by the ban threats issued by the government. According to Sumnesh Salodkar, a successful crypto investor, it’s illogical for an investor to pull out from crypto and watch from the sidelines as profits double weekly for other investors.
Crypto exchanges have recorded increased volumes of transactions as new investors join the crypto market. Paxful, a peer-to-peer crypto market, recorded more new registrations in the past year than other years as more people sign up to buy Bitcoin.
There are no taxes imposed on Bitcoin trading or any profits generated from mining or using Bitcoin as yet. However, there are reports on the planned introduction of Income-tax and GST tax on Bitcoin. This action may not mean that Bitcoin is officially legal in India, so it may last short-term as the government deliberates on the pending Bill.
Regulation of Bitcoin Trading in India
There are no Bitcoin regulations in India yet. However, the Indian government and the RBI had imposed a ban on regulated financial institutions like banks from providing any crypto-related services and transactions.
According to the government, cryptocurrencies are part of a Ponzi scheme targeting its people and will by no means allow their use in the country. The ban made it difficult to transact business as usual for crypto investors.
Crypto enthusiasts countered this ban in the Supreme Court and won. In early 2020, the Supreme Court overturned the RBI and the government’s decision, allowing banks to facilitate crypto-related transactions to all investors.
A new Bill, “Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019 (now 2021), was drafted. It aims to ban any activity involving cryptocurrencies. If the Bill is passes, it will be illegal to own, mine, buy, sell, hold, or use Bitcoin or any other cryptocurrency as a payment method for services or goods.
The government is confident that the Bill will pass in parliament considering the high number of the Prime Minister’s supporters in the current parliament. However, stakeholders in the cryptocurrency field are pushing for regulations instead of a complete ban.
Experts are expected to review the proposed Bill and advise government stakeholders on the best way to move forward. Even though strict regulations would be imposed on cryptocurrencies, it would be a better choice than banning them.
The future looks bright for India’s crypto regulation, especially after the Supreme Court’s ruling. However, we have to wait until the parliament decides on whether to pass the Bill or not.
Best Places to Buy Bitcoin & Crypto in India
It’s prudent to find safe and reliable places to buy your Bitcoin with an unfavorable legal atmosphere. A good place would offer peer-to-peer services or one that allows you to safely buy your Bitcoin and hold it or sell it to other investors.
Therefore, we look into two places that may offer the best services to you when buying Bitcoin. These two are eToro (a safe social trading platform) and Paxful (the best peer-to-peer marketplace).
How to Buy Bitcoin in India through eToro
eToro’s presence in India is faced with hurdles as the Securities and Exchange Board of India (SEBI) prohibits Indians from using it, especially for Forex trading. The reason is, eToro doesn’t accept Indian Rupee as a base currency.
Since eToro is a foreign trading broker and doesn’t use INR as their base currency, any transaction carried out with the broker is considered illegal.
However, the restrictions do not hinder eToro from conducting business as investors can deposit their funds in the currencies and buy Bitcoin and other cryptocurrencies. Most investors love eToro, making it a leading broker in India.
This is because:
- eToro is an innovative platform with features that retain its competitive advantage.
- It offers web trading and mobile trading platforms, and so you can use it on the go.
- You can buy and hold your cryptocurrency in their safe crypto wallet, or you can trade them as CFDs and make huge profits.
- It allows a minimum deposit of $200 from Indian investors.
To buy Bitcoin through eToro, you’ll need an eToro account. Go to eToro.com to create an account in India and make a $200 (minimum) deposit. On opening the account, you’ll get a free eToro crypto wallet to hold your Bitcoin.
After making a deposit successfully, choose the cryptocurrency you want to buy (Bitcoin), the amount you’re willing to spend and proceed to secure your Bitcoin.
How to Bitcoin in India through Paxful
Paxful allows you to convert INR to BTC in a peer-to-peer exchange easily. You can use different payment methods in India, such as IMPS Transfer, PayTM Online Wallet, Google Play, Game Items, Phonepe, and PayPal.
It’s the most preferred Bitcoin trading platform for the following reasons:
- The process of buying Bitcoin is simple, and you get your Bitcoin sent to you directly.
- Paxful provides you with a tightly secured crypto wallet where you can keep your Bitcoin.
- There are many deposit options, so you can use those that work best for you.
To start buying and selling Bitcoin, you must have a verified account. Go to Paxful.com and create an account. Different offers will be showcased to you so you can find one that suits your requirements.
Once you find a favorable offer, you can initiate the transaction, and the seller will complete it if your terms agree with theirs. On completing the transaction, they receive the money, and you receive your Bitcoin. It’s that simple.
Bitcoin Price in India
In March 2021 (at the time of the writing), the price of Bitcoin in India is as follows.
1 Bitcoin is equivalent to 3,913,315.55 Indian Rupee.
This price may rise or drop depending on the market conditions. Please check for the current price.
Cryptocurrency Scams in India
India has had it all in terms of crypto-related scams. From Ponzi schemes to fake coins, let’s talk about it here. As it is for many scams, the investment, offers, and investment returns don’t add up. They always sound too good, and that’s the first red light.
Some of the notable cryptocurrency scams noted in India are:
- The Morris Coin Scam
It involved three companies – Morris Trading Solutions, Long Reach Technologies, and Long Reach Global – who collaborated to collect over INR 15000 from investors. They were all working on launching a fake coin, the Morris Coin, and unsuspecting investors fell prey to the scam. Reports say that the police took in the CEO of the companies.
- MLM Scam by Amit Bhardwaj
This was a pyramid scheme orchestrated by Bhardwaj, a well-known crypto investor. It was easy for people to believe him, considering his reputation in the crypto space.
The investors were promised high returns of 10% on every investment and would receive incentives for signing up more investors. With time, people realized it’s a Ponzi scheme and began to pull out. He got away with over $300 Million worth of cryptocurrency.
- Bitconnect Coin Scam
Darji launched the Bitconnect coin in December 2016 and promoted it widely on social media. Investors were promised high returns up to 60%, and more incentives would be added to an investor who brings in more investors. It was called referral interest.
People would soon realize that it’s a scam and raise complaints against it. A few months later, Darji was arrested after getting away with over $12 Billion worth of cryptocurrencies.
Bitcoin Mining in India
The first question to ask is the legality of Bitcoin mining in India. We know about the pending Bill that threatens the existence of Bitcoin and other cryptocurrencies in India. The verdict will determine the future of Bitcoin miners, but for now, mining can continue.
Bitcoin mining is energy-intensive as it consumes a lot of electricity (estimated 60 TWh a year). In India, electricity is a luxury. Millions of people have not accessed reliable electricity.
This electricity limitation has caused many investors to shy away from mining Bitcoin and invests in what they already have. Investors who have chosen to indulge in Bitcoin mining despite their challenges say that it’s possible and can be profitable.
The price incurred while mining Bitcoin varies for different states. For example, miners in New Delhi enjoy lower electricity prices than those in other states. On average, electricity prices range from 10-12 cents per kWh.
Experienced miners like Anshul Dhir have turned to other alternatives like solar power, even though it comes with its limitations.
Unable to withstand these unfavorable conditions, miners have opted to move and set up their mining stations in countries with less-strict laws like Armenia in Central Asia. Things will remain like that until India becomes a more favorable home for Bitcoin miners.
Bitcoin Popularity in India
Since its launch, Bitcoin has found favor among the Indians. They were among the first people to own Bitcoin, and it’s the same to date. Despite ban threats always hovering over the Bitcoin space, it has thrived through it, and more people continue to adopt it.
In 2018, when the government imposed a ban on banks facilitating crypto-related transactions, crypto enthusiasts and exchanges developed ways to transact on a peer-to-peer basis without involving banks. After the ban was lifted, India experienced a boom in the crypto market, and they tripled amounts transacted in a year.
When the Covid-19 pandemic struck in 2020, many more Indians opted for cryptocurrency, which was not affected by the derailing economy. Crypto exchanges and peer-to-peer platforms have reported increased member registrations in the recent past.
We can say many of these new sign-ups are driven by the ‘fear of being left out as we have witnessed the price of Bitcoin hit its all-time high (ATH). However, the parliament’s decision on the Bill will determine whether these new investors will live in the crypto world long enough to profit from the next ATH.
Where Can I Use in India?
Bitcoin can be spent anywhere globally, and you only need to know where and on what. In India, you can spend your Bitcoin online on stores that accept Bitcoin as payment. Such stores are SapnaOnline & Overstock.
SapnaOnline allows you to buy books online with your Bitcoin. You can also get electronic gadgets and toys from the store. Similarly, Overstock lets you exchange your Bitcoin for almost anything, like home décor, travel, car, appliances, etc. Shop for movies on the Windows Xbox store with your Bitcoin and enjoy the latest movies.
You can get shopping gift cards from Nafa and Purse, which you can use to shop on Amazon & Myntra. Some eateries also accept gift cards bought using Bitcoin, where you can buy food and drinks.
If you’re oriented towards charity, you can also find humanitarian organizations that accept Bitcoin, and you can donate some.
Bitcoin ATMs in India
At the moment, there’s only one Bitcoin ATM in India. It’s located in Delhi and can serve four different coins. These are Bitcoin (BTC), Ether (ETH), Lightning BTC (LBTC), and Bitcoin Cash (BCH). The machine can not withdraw fiat currency (Indian Rupee), but you can use it to buy or sell your cryptocurrency.
Hopefully, this guide on how to instantly buy Bitcoin in India have helped you to buy your first bitcoin, either you choose eToro or Paxful.
Guides for other places to buy Bitcoin:
(in 2021)The post How to Buy Bitcoin in India Instantly (in 2021) appeared first on TradingGator.
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