We will decide whether portfolio transfers should be banned, depending on what the report suggests. Legislation is still being drafted. When we taxed it (in Budget 2022), we made it clear that the legislation was still ongoing. This report would help address the legislative aspect to a great extent,” the official said. We hope this guide has answered some of your questions about the legal status of cryptocurrency and whether or not it is legal to buy Bitcoin in India in 2022. If you`re looking for more information about the vast world of crypto, visit our blog page – where we regularly publish informative articles to your advantage. Cryptocurrency has been a controversial topic since its inception. It has been widely criticized for its volatility and environmental impact, and is even referred to as a “Ponzi scheme” by top economists. However, some countries still believe in the decentralizing power of cryptos such as El Salvador, which made Bitcoin legal in September 2021, followed by the Central African Republic in April this year. Finally, transfer money (INR) to your trading account, which you can use to buy Bitcoin or any other cryptocurrency of your choice.
The FSB is also investigating international precedents surrounding cryptocurrency legislation, and its report is expected to guide India`s legal policy to address concerns related to money laundering and terrorist financing around cryptocurrency trading that have recently surfaced in India. Bitcoin is certainly the most popular cryptocurrency in the world right now, and India will benefit greatly from this revolutionary technology. However, citizens still don`t know if cryptocurrency is legal in India. We`ve come a long way since the crypto banking ban in 2018. While a cryptocurrency bill is still in the works, the government has begun a series of discussions with crypto industry stakeholders in 2021. The Union`s budget speech could be called a milestone in the history of cryptocurrency in India, as for the first time, the government has proposed taxing cryptos and legitimizing them (if not legalizing them). However, we still need more clarity on the government`s position on cryptos. It depends on the cryptocurrency exchange.
While the price of a bitcoin can be in tens of lakhs, you have the option to buy a fraction of bitcoin for as little as INR 100. For example, WazirX allows you to buy Bitcoin for only INR 100. – People who invest in private crypto need to understand that it does not have government approval. There is no guarantee that your investments will be successful or not, you can lose money and the government is not responsible for it, added the Minister of Finance. The government is concerned about the use of Bitcoin for payments for illegal activities such as money laundering, tax evasion, terrorist financing, etc. The government intends to prevent the illegal use of cryptocurrencies. However, as we discussed in a recent article, blockchains can be great forensic tools for catching malicious actors. – However, the Minister of Finance clarified that things that are not legal do not mean that they are illegal. “I`m not saying Bitcoin or Ethereum is illegal, but it`s not illegal either.
But I can say that when regulation comes for cryptocurrency, it will also not be legal tender,” Somanathan said. – Regarding crypto regulation, the Minister of Finance said that he may apply for KYC, the seller`s license, but this will be decided later by the government with broad stakeholder consultation. The government, he said, will also see what is happening in other countries. What about the imposition of a Goods and Services Tax (GST), which was also discussed? “Once we look at the legal side of crypto, the next step would of course be the introduction of the GST. For the introduction of the GST, it is first necessary to classify what type of asset it is – is it a good or a service? We hope that the report will help answer these questions. These consultations are largely ongoing and depend on whether we try not to legalize it,” the official said. At a post-budget press conference, Sitharaman said consultations on crypto regulation and what is legal are ongoing, which will not be clear once the regulatory document is finalized. Third, despite these formidable challenges, India continues to offer significant promise for cryptocurrency exchanges. Companies like Coinbase recognize that India`s population is getting younger, while internet penetration and adoption of digital assets will only increase. Exchanges will need to assess how long they are willing to wait and what they are willing to tolerate given recent developments in New Delhi.
As mentioned earlier, Bitcoin is legal in India, meaning you can buy, sell, and hold it as an investment, but no governing body maintains or protects it.