India cryptocurrency illegal

india cryptocurrency illegal

The legal status of cryptocurrencies varies substantially from one jurisdiction to another, of countries the usage of cryptocurrency isn't in itself illegal. India has proposed tax on cryptocurrencies (REUTERS) "I am not saying that Bitcoin or Ethereum is illegal, but that is not illegal too. CRYPTOCURRENCY TO BE BANNED IN INDIA? Reserve Bank of India (RBI) Deputy Governor T Rabi Sankar on Monday said that banning cryptocurrencies. BITCOIN MINING SIMULATOR HACK

The finance ministry did not respond to an email seeking comment. Although the government has previously said it aims to to promote blockchain technology, the proposed law will also deal a blow to its use as well as to the non-fungible token market in India, lawyers said. The government's plans to crack down heavily on cryptocurrency trading sparked a frenzy in the market and several investors exited with significant losses.

Lured by a barrage of advertisements and rising prices for cryptocurrencies, the number of investors in crypto assets has surged in India. The government now plans to also come down heavily on advertisements that seek to woo new investors, according to the draft summary of the bill and the source. Self-custodial wallets that allow people to store digital currencies outside exchanges are also likely to be banned, the source added. The tough new regulations stem from the central bank's grave concerns about digital currencies and aim to put in safeguards to ring-fence the traditional financial sector from cryptocurrencies, the draft summary of the bill said.

This content is not available in your region. Prime Minister Narendra Modi's government has previously flagged that it plans to ban most cryptocurrencies - Copyright Getty via Canva. RSS-affiliate Swadeshi Jagran Manch on Sunday passed a resolution demanding that the central government completely ban buying, selling, investing and otherwise dealing in cryptocurrencies by any person in the country.

The national meet had started on December It also said that people holding cryptocurrencies can be allowed to sell or exchange the same within a short span of time, subject to provision of submitting information to the Income Tax department. The resolution passed at the SJM national meet argued that giving recognition to cryptocurrencies could lead to heavy speculation and adversely impact the financial market. The Union ministries of consumer affairs and corporate affairs should roll out an "aggressive" consumer awareness campaign, after banning cryptocurrencies, to advise people not to fall prey to "deceptive advertisements" being circulated by the "so called cryptocurrencies' exchanges", especially in Tier-2 and Tier-3 cities, the SJM said in its resolution.

The CBDC should be considered as legal tender," it said, adding, "Cryptocurrencies such as Bitcoin, Ethereum, etc should not be recognised as asset or digital asset because it will indirectly become medium of exchange like currency.

Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by NDTV. NDTV shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.

Cryptocurrency Prices across Indian exchanges.

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Traditionally, investors used gold to hedge against stock volatility. But today, crypto is slowly emerging as a mainstream investment class especially among millennials. It is true that it is not illegal to buy cryptocurrency in India. However, there is no legal guarantee of the safety of the invested amount like regular investment avenues. The virtual currency is not guaranteed by the Central Government, so, in order for any virtual currency to be declared legal tender, it will have to be expressly guaranteed by the Central Government.

In that case, parties are legally bound to accept it as a mode of payment. Dubey said the government has cautioned people about the risks in dealing with virtual currencies stating that virtual currencies are not a valid legal tender in India and even made clear that virtual currencies do not have regulatory protection in India. The RBI had also cautioned about the potential financial, operational, customer protection and legal risks associated with virtual currency.

Shetty believes that over the next few months, we will see crypto go mainstream faster with more retail investors, and first-timers entering the market. If you want to start investing in cryptocurrency even after knowing all the risks, Shetty suggests that as a first-timer in crypto, the most important thing you should bear in mind is that that crypto is a high risk, high reward investment option. Shetty said that as of now, there is no crypto regulation in India. However, buying Bitcoin is absolutely legal in India.

He said that there was a banking ban between July — March due to which cryptocurrency exchanges were not able to hold bank accounts. However, the Supreme Court of India quashed the banking ban in Dubey said that the Department of Economic Affairs, Ministry of Finance had constituted a committee to study the issues related to virtual currencies and propose specific actions to be taken.

This committee presented its Report dated February 28, recommending prohibition of all private cryptocurrencies, except any virtual currencies issued by the state. However, it will support and use underlying cryptocurrency technologies. According to Shetty, the RBI ban was an under-researched and arbitrary move. Bitcoin is slowly emerging as a mainstream investment class especially among millennials. Majority of WazirX users are below 30 years of age. The youth is looking at crypto as an alternate investment option, and increasingly participating here.

Bitcoin is labelled as digital gold by many, and is also seen as more superior to gold in several respects. It offers a high degree of accessibility, allowing anyone to send and receive Bitcoin in a permissionless way. Dubey said that Bitcoin has generated a lot of curiosity amongst the youth in India. The support to the usage of cryptocurrency extended by the IAMAI has also been a major factor in securing popularity.

He further said that the startup sector in India is particularly fond of cryptocurrencies since they facilitate cross border transactions with ease, which provides a lot of opportunities to small and medium enterprises to expand their presence across the global market. Dubey said that in India, the regulators and governments have been sceptical about the virtual currencies and are apprehensive about the associated risks.

Slowly, more and more people are becoming aware of crypto, and wanting to pursue a career in Blockchain. Positive regulations will give a big push to crypto adoption in India with more startups building projects on blockchain. The future is exciting! Download Financial Express App for latest business news. By subscribing, you agree to our Terms of Use and Privacy Policy. You may unsubscribe at any time. By Fabienne Lang. India's ban on cryptocurrencies As far as the official who spoke with Reuters said, the bill would give crypto owners six months to rid themselves of any digital assets, after which penalties will come into place.

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We acknowledge that the issue of Bitcoin and cryptocurrency regulation has been a persistent and painful problem due to its decentralized nature. Also, we empathize with the fact that the government has done this to protect Indian consumers who are rather ignorant and often lack sufficient education regarding many obvious crypto-related MLM scams. The classic example is one of Amit Bhardwaj who scammed Indians as well as other people around the world.

Instead, they should have put some more thought into this before taking such an extreme step to impend the innovation happening around cryptocurrencies and blockchain. Well, you might argue this will stop undisclosed investments in cryptos and also paralyze money laundering happening through cryptocurrencies. But when a government does something like this, it kills the curiosity of the techie and hinders his indulgence in the technology.

This is like killing the minuscule blockchain or crypto market of India with your own hands. And it even gives a hint that the government was unable to regulate decentralized cryptocurrencies in the right way which has forced them to take this extreme step. They need to be stopped but that can only happen through proper education.

Ceasing the growth of many because few are misusing it is not the right thing to do. India is not a new candidate in the list of countries banning Bitcoin or other cryptocurrencies. It is, in fact, the 8th country to do so. China , as we all know, started cracking down on cryptocurrency exchanges and ICOs in the last quarter of And as the scenario stands there in China, Bitcoin and cryptocurrency exchanges are totally banned as Chinese government issued a similar message to Chinese banks to pack-up their services to any individual or business related to cryptocurrencies.

As a result, many big exchanges have fled China to seek shelter elsewhere as there are many cryptocurrency havens out there. It dealt a great blow to the overall crypto market but there are alternatives that flourished.

South Korea made its law more stringent but have no intention to ban or suppress cryptocurrency market. Instead, if you are a government official in Korea , you are banned from HODLing or dealing with cryptocurrencies failing which you can face disciplinary charges. Needless to say, countries like Japan, US, Korea, and Australia, who have exercised extreme caution in building upon rules and regulations, are actually growing in the crypto and blockchain space.

We need to look at countries similar to China, and now India, to understand the implications on the flip side. A similar thing happened in China when Chinese government banned cryptos in their country. You can see it for yourself in the LocalBitcoins chart below. Also, you will see a significant spike in peer-to-peer offline trading. But one thing is sure, this will happen and a huge underground market will thrive on it.

We will leave behind india in the race of blockchain and crypto tech as it happened during the dot-com boom. The rest is history. And this can be all the more true for successful exchanges businesses because they can easily shift to countries like Singapore, Hong Kong or Malta and serve the customers from there just like the Chinese exchanges did.

But it will be us, Indians, who will be left behind and deprived of participation in this revolution. And not to forget, this step by the Indian government will scare the hell out many newbies who have entered the crypto market recently as there is no clarity on what is happening around.

They will bid goodbye to the market and never come back impending their long-term growth due the FUD and uncertainty. Lastly, people who want to continue will do so despite government banning cryptos or not supporting it. People who indulge scams will not change paths and those who want to earn only money will also continue.

So people will do eventually what they think is right for themselves. The government might reinstate its stand on crypto and might want to take a smarter step by regulating crypto exchanges through licensing. This will also help in recovery.

Of course, do respect your risk appetite in this case of HODLing. You can also consider moving your crypto business outside India. Even if you are a trader, you can still consider opening a business in a country like Singapore, Malta, USA sitting here in India. Since, these countries have a clear regulation, it will not be a problem for you.

Move over, you can bring money to India, pay income tax, and enjoy the rest of money to live a dream life. There are few other similar solutions that you can take advantage of breaking no law or violating RBI guidelines.

However, according to your own unique condition, thoroughly assess what needs to be done with your cryptocurrency investments. Feel free to use the comments section below to discuss what the long and short-term implications of this step by the RBI can be.

Also, stay updated on the latest happenings by watching this space on CoinSutra as we are closely monitoring this situation. Below is the summary of it:. There is no complete ban on VCs. RBI not against Blockchain. RBI has done its homework before issuing circular. Can u please help me on gulf coin gold. One of my friend approaching to get in. Present price is RS 20 and expected to reach to by Dec this month. Which can be converted to Bitcoin or other currency. Question is how can I bring profit home.

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Close enemies, distant friends? Yusuf Alabarda, retired colonel of the Turkish Armed Forces. All rights reserved.

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