The hot topic in financial world in these days is Cryptocurrency. With the increasingly demand for Cryptocurrency across the world now countries are making laws and regulatory to control the evolving market. In this article we will explore whether cryptocurrency legal in India ?
What is Cryptocurrency
Before going to understand the legality of cryptocurrency in India we have to understand that what is Cryptocurrency and how it is works. Cryptocurrency is an encrypted digital token use the blockchain technology to carry out successful transactions from one person to other without interference of any third party i.e it is not controlled by any government or central bank.
How does cryptocurrency works ?
Cryptocurrency use the technology called blockchain to execute the transaction. Now we will understand this in two steps
Step 1: When a transaction initiated, an electronics massage received by other network users regarding the transaction about the electronics address of the transaction, units to be traded and the unique code. The transaction matches with all other transactions waiting to be completed and sit together to complete a block.
Step 2: Next the information from the block will give a cryptographic code. Then the miners compete to solve this complex cryptographic code so that a new block can be added. After verification from the other network user the new transactions block will be added to the blockchain and the transactions will be completed.
Legality of cryptocurrency in India
Any currency is a legal currency if it holders the legal tender that backs by the government of the state. That means the same currency is accepted by the government and can be utilize and exchanged for value.
Till date the cryptocurrency transaction is being carried out for investment in cryptos. However in India cryptos are not acceptable for exchange of value and services and can not be utilized to repays the debt hence it doesn’t hold the legal tender in India.
Considering its public acceptance and as it may play an important role in global economy in future it cannot be banned, however in the union budget 2022 the tax 30 % is charged on cryptocurrencies in India.
India is still awaiting a clear rules on the subject of cryptocurrency and it’s future in India. The government may come with a bill for cryptocurrency about its legal tender, transactions, trading, tax and mining.
Legality of cryptocurrency in other countries
Many countries are framing the rules broadly covering every aspects of cryptocurrency. However some of the countries that has legalized some selected cryptocurrencies are USA, Canada, Israel, Australia, EU, Central African Republic, .El Salvador etc.
Countries that has banned the cryptocurrency completely
There are countries that impose a total ban on cryptocurrencies such as Chaina, Qatar, Egypt, Bangladesh etc.
Some of the famous cryptocurrencies in the world
- Bitcoin
- Ethereum
- Tether
- Solana
- Ripple
There are hundreds of other cryptocurrencies are available but these are some top cryptocurrencies you may track and consider buying some portion of it for your future. You can also trade in cryptocurrencies for more returns but it’s highly risky due to it’s volatility.
How to buy cryptocurrency
Buying cryptocurrency is easier these days, there are multiple crypto exchanges are available like Coinbase, Binance, Coinswitch Kuber etc. You can open your account by fallowing these three steps.
Step 1. Complete the KYC process
You need to login to their site or download the application. Verify by giving details and complete the KYC process. Your account will be activated now.
Step 2. Add Fund to your wallet
After successful login and completing your KYC now you can add money to your wallet from your bank account. As soon as the transaction successful you can see the amount in your crypto wallet.
Place Crypto Order
Well done, now you can place your crypto order. Suppose you have 500 rupees in your wallet and you want to buy bitcoin. Search for bitcoin, click on buy , add amount, and then proceed. Now bitcoin worth 500 rupees added to your account. Similar you can sell and withdraw the amount to your parent account.
Conclusion
There is no doubt sooner or later the government has to accept the digital token, but it has to go through different stages of development. The investors must be careful about it’s high volatility and must be vigilant about the policy changes across the globe. As of now India has a neutral approach towards cryptocurrency but it is expected that soon India may come up with a clear guidelines for cryptocurrencies.