2021: How To Buy Bitcoin In India & Is It Legal?

Is it too late to join the Bitcoin party?

With the meteoric rise 📈 in price, Bitcoin is now again making headlines for setting a fresh All-Time-High.  Since march 2020, this decentralized cryptocurrency has alone given more than 1000% to it's holders and has become a hot topic among everyone.

If you are new to cryptoverse and wondering what bitcoin is, how it works, is it legal in India, how to buy it & where to buy it or is it too late to invest in Bitcoin then sit tight my friend!

My name is Ashish and I have created this guide explicitly for beginners to help them with the basics of bitcoin, show how to buy bitcoin and answer all the common questions that are often asked.

If you are intrigued by this decentralized cryptocurrency and want to learn more about blockchain, their applications & stay updated the with hot trending cryptocurrency news then you'd love to be part of our friendly crypto community on telegram. 📲

Here, you'll get to meet like minded people to discuss everything about crypto and learn from their experiences. Anyways, that's enough of me gabbering, let's get back to the main course.

What is Bitcoin?

Bitcoin is a decentralized payment network that is neither governed by any bank nor by any country. Instead, people like you and me from all around the globe contribute to the network and helps in maintaining the whole ledger (KhataBook). This is why it is often called global currency.

In Simple language, Bitcoin is a file that could be stored on a computer or a digital wallet like Atomic Wallet or ZenGo. There are two key components of this file i.e., private key & a public key.

Private key is something that is suppose to be kept confidential, think of it as a pin/password that is required to access the file/Bitcoin wallet.

Whereas public Key acts as a account number that could be published to the world and to which other may send Bitcoins.

How Bitcoin Works?

Bitcoin, the first cryptocurrency, is powered by a network of individuals (miners), much like editors who create Wikipedia and is backed by a open-source code. This network of miners verify the blocks of transactions and then record them on the bitcoin blockchain which helps in maintaining the trustless public ledger.

This is the process that is called mining and miners are rewarded in Bitcoin for verifying the blocks. These rewards are cut in half after every 210,000 mined blocks or about every four year and the event is called the halving.

Is Bitcoin Legal in India?

Yes! ✅ It is legal to buy, sell, hold & trade bitcoin or other cryptocurrencies in India.

There is a misconception that RBI has banned cryptocurrency trading, though the truth is, entities regulated by RBI were directed (on 6th April 2018) not to deal in virtual currencies or provide services for facilitating cryptocurrency transactions.

However in March 2020, the supreme court of India overturned this order on the ground of disproportionality, bringing cheers to both the users and local businesses.

In December 2020, the Income Tax Department of India monitored earnings of several cryptocurrency investors registered through KYC/AML compliant cryptocurrency exchanges and urged them to pay tax on their profits.

Had investing in bitcoin & cryptocurrencies been illegal, tax authority would have not asked to pay the tax. Instead, the story would have been totally different.

How To Buy Bitcoin In India?

As the supreme court of India has legitimized the trading of cryptocurrency across the country, Bitcoin have interested Indians in investing in cryptocurrencies. While this is the best time to get involved in the future of finance, it is more important to find the right platform and place to make this investment.

This is why at Coinspectus, I came up with this beginner's guide to buy bitcoin in India. Though there are several cryptocurrency exchange available in the market but finding the right one makes all the difference.

I personally prefer Binance. It is a big elephant 🏛️ in the cryptoverse which is trusted by more than 10 million users across the globe and has everything in one place. No matter if you're a beginner or a professional trader, this platform is hell easy to use and execute trades.

Above all, you find most of the popular altcoins listed on this single platform so you won't have to create multiple accounts on multiple exchanges.

Steps to buy bitcoin:

1. Register on Binance, verify your ID. (Takes only 5 quick minute)

Visit the Binance.com and as a precaution bookmark the webpage because there have been many cases of phishing sites that mirror the actual website. Click on the "Register" tab, enter all the relevant information and verify your Identity/basic Information.

2. Once the account is verified, click on "Buy Crypto" tab on the top-right corner.

There are several options to buy cryptocurrencies on Binance however the most popular is Credit/Debit card. 

3. Choose the crypto you want to buy (In this scenario we have BTC) & the fiat you want to pay in i.e., USD, AUD, or EUR.

Unfortunately, INR is not yet supported on binance although users can still opt to pay in USD/EUR and their bank will automatically convert the amount in INR.

4. Enter the amount you want to buy and hit "Buy Bitcoin".

5. Make the payment and voila! 🎉 Your coins will be credited to your Binance wallet instantly.

Is It Too Late To Invest In Bitcoin?

The "too late" mindset will ruin your investing psychology & potential to make profits. There is no doubt, Bitcoin has gone mainstream but there is still a lot of room for Bitcoin price to appreciate.

When people think about bitcoin, I quickly see them become disappointed for not getting involved earlier and not buying at least one bitcoin when the price was lower.

However, what they don't realize is that the best time to buy bitcoin is whenever you decide to.

Bitcoin, with $1 trillion market capital, is considered to be a digital gold and a go to option to hedge against inflation, store value & protect it from recession and crisis. 

The current value of world's supply of gold & derivatives is around $9 trillion & $640 trillion. If only a small amount of money is moved from these asset classes to bitcoin then the BTC price will skyrocket.

Investment firms, institutional investors & conglomerates are buying bitcoin like never before, not because they want to, but because there are fewer options to put your money and protect it in the event of a downturn or recession.

More recently, Tesla, the electric car 

🚗

 maker, bought $1.5 billion worth of bitcoin. Mastercard has plans to support cryptocurrencies, particularly stable coins, directly on its network.

What bitcoin has done to date is irrelevant. If you have not bought any or don't understand it then that's not the issue. The issue is whether you are open minded enough to rethink everything you know about money and investing.

And if you are then there is an opportunity, my friend!

Is Bitcoin Taxable?

Yes, returns generated from trading bitcoin or investing in cryptocurrencies are  taxable. 🧾 Though there is a lack of clarity on tax front on Bitcoin investments in India but as per the traditional market, short term investments in cryptocurrencies are taxed at 30% and the long term investments (above 3 years) are taxed at 20%.

Conclusion:

Now you are aware of the exact status of cryptocurrencies in India & the best platform to buy and sell bitcoin, it is your turn to DYOR (Do your own research), play with the platform and make a decision.

Last but not least! If you like the post share it with your friends on social media, help us spread the awareness and if you have any question drop it in the comments or join us on Telegram.

Thank you! 

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