Bitcoin in India
Cryptocurrency is digital money, the real money to be considered to be a little more secure. Cryptocurrency uses something to encrypt its transfers, called cryptography. Or put it in plain language, cryptography is a way of transforming comprehensible data into complex codes that are impossible to crack. They are classified as a subset of digital currencies and alternative currencies according to the Bitcoin news. Bitcoin was the first cryptocurrency ever to be developed in 2009. There was subsequently a significant increase in the number of cryptocurrencies produced, some of which are Litecoin, Ethereum, Zcash, Dash, Ripple etc.
One can obtain bitcoins either by :
1. Mining- Mining is an exercise where an individual (called the “miner”) uses his or her programming skills to solve computationally complex puzzles.
2. Buying them against real currency from a bitcoin exchange- Anybody can’t be a bitcoin miner. Consequently, consider buying bitcoins from bitcoin exchanges and store them in digital form in an online bitcoin wallet.
3. Receiving bitcoins in respect of the sale of goods and services- While this may not be a common phenomenon in India at the moment, few businessmen accept bitcoins (instead of real currency) when selling goods or services, according to startup news.
How to tax Bitcoins in India?
The idea that bitcoins are entirely new to the Indian market, obviously the government has not yet incorporated the taxability of bitcoins into the statute books. At the same time, there is no way to rule out the tax levy on bitcoins as Indian income tax laws have always sought tax revenue received regardless of the form in which it receives.
Legal Status in India
Bitcoin is neither authorized nor regulated as a form of payment by any central authority. However, there have been no fixed laws, regulations or guidelines created to resolve disputes that may arise when dealing with bitcoins. India’s approach to Bitcoins and other cryptocurrencies is not optimistic. A council of high-level government has recommended a ban on all virtual cryptocurrencies in India.
Bitcoins had only begun to gain momentum in India when the banking ban of the Reserve Bank of India (RBI) was introduced in 2018. RBI had then said that every company it oversees, such as banks, wallets, etc., could not engage with or provide any individual or business organization with services for the purchasing or selling of cryptocurrencies.
In addition to the ban, the Committee has proposed a Rs 25 crore fine and imprisonment for up to 10 years for any virtual currency-related activities carried out by individuals, app developers or corporations.
The misunderstanding arises from the fact that in April 2018 RBI barred banks from operating crypto-exchange accounts and disallowed customers to use banking platforms to settle crypto-transactions.
The problem has two parts:
- Buy/Sell Bitcoins
- Routine payments using bitcoin