WHAT IS BITCOIN and IS IT LEGAL IN INDIA? – SkillVancer

We all read about Cryptocurrencies every now and then. Even if we do not understand them a lot. We definitely have an Idea. That they are a bit different than our conventional currency notes or coins. One such cryptocurrency is Bitcoin. We hear about Bitcoins every now and then. We shall learn about Bitcoins a little more in-depth. And if citizens of India can deal with them or not, in this article. 

UNDERSTANDING BITCOIN

• Bitcoin is a cryptocurrency. Probably one of the earliest forms. It forms the part of the peer-to-peer payment system. Worldwide (Cryptocurrency is a form of digital money). And of course doesn’t exist as physical currency. They exist only online and not as notes or coins. Also used in selling, or buying articles from companies. And people who accept payments in Bitcoins. It considered as safe, more secure rather than real money.

• Cryptography is used for secure transactions. Cryptocurrencies are distinguished as alternative currencies. For example, virtual currencies and digital currencies. Bitcoin is actually the first cryptocurrency ever. Created in the year 2009. By a mysterious character going by the pseudonym Satoshi Nakamoto. There was a swift acceleration in the number of cryptocurrencies. For example, Ethereum, Dash, Litecoin, Zcash, Ripple, etc.

• Bitcoins don’t have a Central Bank. No state is regulating it. Its supply is being decentralized. by the process of mining chances of increase are high. For every transaction, a computer owned by the miner. Who must solve a tough mathematical problem? Then a fraction is given to the miner.

WHERE AND HOW BITCOINS ARE GENERATED?

A person can obtain Bitcoins By –

• MINING: It is a process in which an individual (miner), needs to crack a computationally difficult puzzle. This process is integral to the technology of blockchain. Which helps in maintaining them. The miner gets new Bitcoins, as a reward for this. Which are creations of mining of Bitcoins.

• BITCOIN EXCHANGE: Not everyone can be a miner, therefore one can rather consider buying Bitcoins. From Bitcoins Exchange and store them. In the digital form, in online bitcoin wallets. A few Bitcoins Exchange present in India right now are:- Unicorn, Zebpay, Bitxoxo, Coinbase, etc. Purchasing them consideration for real currency. The current value of 1 Bitcoin = 8,05,074.21 INR.

• Bitcoins in consideration of selling services and goods: Although, this is not a very common phenomenon. Currently in India, yet there are a few businessmen who accept Bitcoins. Instead of other currencies. For the sake of services and goods, they deal in.

IS BITCOIN LEGAL IN INDIA?

1. Since the government of India is putting efforts. To move towards a cashless economy. Bitcoins are gaining popularity among Indians. Unlike how the physical currency in India. Under the regulation of RBI. Regulation or administration is not done by any specific unit/body. It is under the Indian federation. In fact, it is managed using a technology called the blockchain. Which actually serves as a public record for all transactions. RBI manages the supply of money. And keep the prices steady. They can withdraw some money from circulation. Or can print more, if they consider it’s necessary. They also can use monetary policy controls. For example, adjusting interest rates.
2. Since the central authority of India doesn’t regulate Bitcoins. There are no further sets of rules, guidelines, or regulations. They have laid down for any disputes. that could ever arise while dealing with Bitcoins.
3. Bitcoin translations, of course, have their own bunch of risks. We can not conclude if Bitcoins are illegal or not. Until it is not going to ban in India.
4. In its ruling pronounced on the 25^th of February, 2019. The Supreme Court of India required the Government of India. To concoct policies related to Cryptocurrencies. The subject was adjourned in the hearing on the 29^th of March, 2019. And was rescheduled for the second week of July 2019.
5. The government of India is planning to introduce new laws to ban cryptocurrency. Apparently, which will come as a huge blow. It already boomed the economy. Because of the pandemic, because of lockdown.
6. The government is apparently holding consultation sessions. Finally to introduce a framework that may end all sorts of trading. Of cryptocurrencies in India, formally.  

TAXATION OF BITCOIN IN INDIA

The concept of Bitcoins isn’t very popular in the Indian market. And the government has not brought taxability of cryptocurrencies in statute books. Since the income tax laws, in India have always sought to tax. Or any income received despite the form and received. Now the conscript of tax on cryptocurrencies had ruled out. The ITO in India sent out tax notices in 2019, many of people. Since the transaction crossed the 25 crore INR mark in 17 months. A lot of economists believe that the Union Budget of 2018 might shed some light. Over the tax treatment of bitcoin in India. If we consider the recent implications of the Government of India. Undoubtedly, about Cryptocurrencies, there are many trivial questions regarding the future of Bitcoins.

CONCLUSION

Therefore, we can conclude that Bitcoins. or any cryptocurrencies for that matter are not regulated by any Central body in India. There are possibilities of Cryptocurrencies to get banned. It is important to take the necessary safety precautions. Finally before dealing in any kind of Cryptocurrencies. Be it Bitcoin or any other. 

Atreyee

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