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LATEST BITCOIN NEWS INDIA AND THE WORLD
LATEST BITCOIN NEWS
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Read our article " CRYPTOCURRENCY TAXES IN INDIA " by clicking Here
Read our article " CRYPTOCURRENCY TAXES IN INDIA " by clicking Here
BITCOIN IS OFFICIAL CURRENCY OF CAR , PANAMA PERMITS USE OF CRYPTOCURRENCIES
Dated 30.04.2022 : The parliament of Central African Republic ( CAR ) passed a bill making Bitcoin as its official currency . CAR is the second country to adopt Bitcoins after El Salvador adopted Bitcoins as official currency in 2021 . Reuters News Agency has reported that the bill was unanimously passed by the parliament .
In another news , Reuter reported " Panama's National Assembly approved a bill to regulate the use and commercialization of crypto assets in the Central American country renowned as a hub of offshore financial services. " Now citizens of Panama can use cryptocurrencies for making civil and commercial payments ,
Dated 30.04.2022 : The parliament of Central African Republic ( CAR ) passed a bill making Bitcoin as its official currency . CAR is the second country to adopt Bitcoins after El Salvador adopted Bitcoins as official currency in 2021 . Reuters News Agency has reported that the bill was unanimously passed by the parliament .
In another news , Reuter reported " Panama's National Assembly approved a bill to regulate the use and commercialization of crypto assets in the Central American country renowned as a hub of offshore financial services. " Now citizens of Panama can use cryptocurrencies for making civil and commercial payments ,
Cryptocurrencies in India / Bitcoins in India
CRYPTOCURRENCIES UNDER PMLA ACT :
Dated 10.03.2023 : As per the notification dated 07.03.2023 issued by the Finance Ministry , activities related to the cryptocurrency transactions have been brought under Prevention of Money Laundering Act ( PMLA ) . This means that Cryptocurrency exchanges, custodians, wallet providers and others in crypto-related trade will fall under the Prevention of Money Laundering Act .
The Prevention of Money Laundering Act (PMLA) is Indian law enacted in 2002 to prevent money laundering and to confiscate and seize the properties derived from laundered money. The act was amended in 2015 to broaden its scope and strengthen its provisions.
Under the PMLA, "money laundering" is defined as any activity that involves the proceeds of a crime and results in the concealment, acquisition, possession, or use of such proceeds. The law covers a wide range of crimes, including drug trafficking, terrorism, corruption, and tax evasion. Now the cryptocurrency transactions have been included under the law .
The new notification says entities dealing in cryptocurrencies will be considered " Reporting entity - PMLA Banks " The PMLA act requires banks, financial institutions, and other designated persons or entities to maintain records of all transactions above a certain threshold and to report suspicious transactions to the authorities. Failure to comply with the provisions of the PMLA can result in severe penalties, including imprisonment and fines.
Reporting entities are required to maintain a record of all transactions for a period of 5 years . Banks and financial institutions are required to maintain records of all transactions above Rs. 50,000 and report suspicious transactions to the authorities.
For designated non-financial businesses and professions (DNFBPs) such as real estate agents, dealers in precious metals and stones, and lawyers, the threshold limit is Rs. 10 lakhs . These entities are required to maintain records of all transactions above this amount and report suspicious transactions to the authorities.
For certain types of high-risk transactions, such as international wire transfers, the threshold limit is lower, at Rs. 1 lakh. .
It's worth noting that the threshold limits are subject to change and may be revised periodically by the authorities to keep pace with evolving money laundering risks and trends.
To read Gazette notification , CLICK HERE
Dated 10.03.2023 : As per the notification dated 07.03.2023 issued by the Finance Ministry , activities related to the cryptocurrency transactions have been brought under Prevention of Money Laundering Act ( PMLA ) . This means that Cryptocurrency exchanges, custodians, wallet providers and others in crypto-related trade will fall under the Prevention of Money Laundering Act .
The Prevention of Money Laundering Act (PMLA) is Indian law enacted in 2002 to prevent money laundering and to confiscate and seize the properties derived from laundered money. The act was amended in 2015 to broaden its scope and strengthen its provisions.
Under the PMLA, "money laundering" is defined as any activity that involves the proceeds of a crime and results in the concealment, acquisition, possession, or use of such proceeds. The law covers a wide range of crimes, including drug trafficking, terrorism, corruption, and tax evasion. Now the cryptocurrency transactions have been included under the law .
The new notification says entities dealing in cryptocurrencies will be considered " Reporting entity - PMLA Banks " The PMLA act requires banks, financial institutions, and other designated persons or entities to maintain records of all transactions above a certain threshold and to report suspicious transactions to the authorities. Failure to comply with the provisions of the PMLA can result in severe penalties, including imprisonment and fines.
Reporting entities are required to maintain a record of all transactions for a period of 5 years . Banks and financial institutions are required to maintain records of all transactions above Rs. 50,000 and report suspicious transactions to the authorities.
For designated non-financial businesses and professions (DNFBPs) such as real estate agents, dealers in precious metals and stones, and lawyers, the threshold limit is Rs. 10 lakhs . These entities are required to maintain records of all transactions above this amount and report suspicious transactions to the authorities.
For certain types of high-risk transactions, such as international wire transfers, the threshold limit is lower, at Rs. 1 lakh. .
It's worth noting that the threshold limits are subject to change and may be revised periodically by the authorities to keep pace with evolving money laundering risks and trends.
To read Gazette notification , CLICK HERE
RBI WANTS PROHIBITION OF CRYPTOCURRENCIES IN INDIA : FM
Dated 19.07.2022 : In a written reply given by The Finance Minister Ms Nirmala Sitharaman in the Loksabha yesterday , she has informed that the country's central bank Reserve Bank of India ( RBI ) favours prohibition of cryptocurrencies in India . However the government is of the view that any legislation for regulation or for banning such currencies will be be effective only after significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards.
Finance Minister Nirmala Sitharaman said that the RBI has expressed concerns over cryptocurrencies saying that they should be prohibited as they can have destabilizing effects on monetary and fiscal stability.
Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India , had advised in February 2022 speech , that banning cryptocurrency is perhaps the most advisable choice open to India. He had argued that crypto-technology is underpinned by a philosophy to evade Government controls. As Cryptocurrencies have specifically been developed to bypass the regulated financial system., it should be reason enough to treat them with caution.
We may recall here that RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies, which was nullified by a court verdict .
The central bank is concerned that Government may lose ability to control the economy and financial stability of the country may be effected by the usage of cryptocurrencies . Further RBI is not ready to recognize cryptocurrencies as currencies , as they are not issued by any authorities .
Dated 19.07.2022 : In a written reply given by The Finance Minister Ms Nirmala Sitharaman in the Loksabha yesterday , she has informed that the country's central bank Reserve Bank of India ( RBI ) favours prohibition of cryptocurrencies in India . However the government is of the view that any legislation for regulation or for banning such currencies will be be effective only after significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards.
Finance Minister Nirmala Sitharaman said that the RBI has expressed concerns over cryptocurrencies saying that they should be prohibited as they can have destabilizing effects on monetary and fiscal stability.
Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India , had advised in February 2022 speech , that banning cryptocurrency is perhaps the most advisable choice open to India. He had argued that crypto-technology is underpinned by a philosophy to evade Government controls. As Cryptocurrencies have specifically been developed to bypass the regulated financial system., it should be reason enough to treat them with caution.
We may recall here that RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies, which was nullified by a court verdict .
The central bank is concerned that Government may lose ability to control the economy and financial stability of the country may be effected by the usage of cryptocurrencies . Further RBI is not ready to recognize cryptocurrencies as currencies , as they are not issued by any authorities .
TDS ON VIRTUAL DIGITAL ASSET FROM 1ST, JULY 2022 :
Dated 02.07. 2022 : Finance Act, 2022 inserted a new section 194S in the Act with effect from 1st July 2022. The new section mandates a person, who is responsible for paying to any resident any sum by way of consideration for transfer of a virtual digital asset (VDA), to deduct an amount equal to 1% of such sum as income tax thereon. The tax deduction is required to be made at the time of credit of such sum to the account of the resident or at the time of payment, whichever is earlier.
CUT-OFF LIMIT :
However TDS is not required to be made in the following cases:-
(i) the consideration is payable by a specified person and the value or aggregate value of such consideration does not exceed Rs 50,000 during the financial year; or
(ii) the consideration is payable by any person other than a specified person and the value or aggregate value of such consideration does not exceed ten thousand rupees during the financial year.
To read original notification ,
Check CBDT notification Dated 28.06.2022
Dated 02.07. 2022 : Finance Act, 2022 inserted a new section 194S in the Act with effect from 1st July 2022. The new section mandates a person, who is responsible for paying to any resident any sum by way of consideration for transfer of a virtual digital asset (VDA), to deduct an amount equal to 1% of such sum as income tax thereon. The tax deduction is required to be made at the time of credit of such sum to the account of the resident or at the time of payment, whichever is earlier.
CUT-OFF LIMIT :
However TDS is not required to be made in the following cases:-
(i) the consideration is payable by a specified person and the value or aggregate value of such consideration does not exceed Rs 50,000 during the financial year; or
(ii) the consideration is payable by any person other than a specified person and the value or aggregate value of such consideration does not exceed ten thousand rupees during the financial year.
To read original notification ,
Check CBDT notification Dated 28.06.2022
India acts tough on Cryptocurrency Income tax
Dated 26.03.2022 : Indian parliament passed Finance bill 2022 incorporating various amendments to the existing tax laws as well introducing new tax laws for the financial year 2022-23 which will begin on April1st , 2022 . The proposals to amend laws and new laws were presented to the parliament on 1st, February 2022 by The Finance Minister Ms Nirmala Sitharaman .
In the budget speech on 01.02.2022 , Indian Finance Minister Ms Nirmala Sitharaman announced that India is going to TAX INCOME FROM THE CRYPTOCURRENCIES AT A FLAT RATE OF 30 % . No deduction is allowed except the cost of acquisition . Further TDS of 1 % will be collected on the amount of transaction in virtual currencies . Receiver of gifts of virtual currency will be taxed
The Finance bill 2022 passed by the Indian parliament yesterday and new section 115bbh has been introduced in the Income tax act incorporating taxes on cryptocurrency . The new inclusion clause is tougher than thought of before as it will not allow any deduction in respect of any expenditure (other than cost of acquisition) nor allow set off of any loss from transfer of the virtual digital asset against income computed under any other provision of this Act to the assessee . Further such loss shall not be allowed to be carried forward to succeeding assessment years also . Now it is clarified that the loss made in a trade in one cryptocurrency cannot be set off against the profit made in other cryptocurrency trade , in a written clarification issued by Union Minister of State for Finance Pankaj Chaudhary in the Loksabha .
The legality of cryptocurrency trade is not yet spelt out by the government and the government has brought tough tax laws making its trade less attractive to traders and investors .
In spite of such adverse investments climate for cryptocurrency business in India , it is guessed that more than 20 million Indians have invested in such risky accounts . We have to see what will happen to the Indian market in coming months with the introduction of new law .
Dated 26.03.2022 : Indian parliament passed Finance bill 2022 incorporating various amendments to the existing tax laws as well introducing new tax laws for the financial year 2022-23 which will begin on April1st , 2022 . The proposals to amend laws and new laws were presented to the parliament on 1st, February 2022 by The Finance Minister Ms Nirmala Sitharaman .
In the budget speech on 01.02.2022 , Indian Finance Minister Ms Nirmala Sitharaman announced that India is going to TAX INCOME FROM THE CRYPTOCURRENCIES AT A FLAT RATE OF 30 % . No deduction is allowed except the cost of acquisition . Further TDS of 1 % will be collected on the amount of transaction in virtual currencies . Receiver of gifts of virtual currency will be taxed
The Finance bill 2022 passed by the Indian parliament yesterday and new section 115bbh has been introduced in the Income tax act incorporating taxes on cryptocurrency . The new inclusion clause is tougher than thought of before as it will not allow any deduction in respect of any expenditure (other than cost of acquisition) nor allow set off of any loss from transfer of the virtual digital asset against income computed under any other provision of this Act to the assessee . Further such loss shall not be allowed to be carried forward to succeeding assessment years also . Now it is clarified that the loss made in a trade in one cryptocurrency cannot be set off against the profit made in other cryptocurrency trade , in a written clarification issued by Union Minister of State for Finance Pankaj Chaudhary in the Loksabha .
The legality of cryptocurrency trade is not yet spelt out by the government and the government has brought tough tax laws making its trade less attractive to traders and investors .
In spite of such adverse investments climate for cryptocurrency business in India , it is guessed that more than 20 million Indians have invested in such risky accounts . We have to see what will happen to the Indian market in coming months with the introduction of new law .
NO SET OFF OR CARRY FORWARD ALLOWED FOR CRYPTOCURRENCY LOSSES :
Dated 24.03.2022 : Further to FM' s announcement of taxing cryptocurrency income from April 2022 . Government of India has added a new section 115BBH in the income tax act in the Finance Bill 2022 introduced in the parliament of India .
As per the new section 115BBH , Tax on cryptocurrency will be 30 % of cryptocurrency income , as announced in the Budget speech . But you cannot set off nor carry forward any loss incurred in a cryptocurrency trade or any other business as per the new section . Further it is now clarified that the loss made in a trade in one cryptocurrency cannot be set off against the profit made in other cryptocurrency trade , in a written clarification issued by Union Minister of State for Finance Pankaj Chaudhary in the Loksabha .
The new section 115BBH , as introduced in the Finance Bill 2022 , says
"
(1) Where the total income of an assessee includes any income from the transfer of any virtual digital asset, the income-tax payable shall be the aggregate of––
(a) the amount of income-tax calculated on the income from transfer of such virtual digital asset at the rate of 30% .; and
(b) the amount of income-tax with which the assessee would have been chargeable, had the total income of the assessee been reduced by the income referred to in clause (a).
(2) Notwithstanding anything contained in any other provision of this Act,––
(a) no deduction in respect of any expenditure (other than cost of acquisition) or allowance or set off of any loss shall be allowed to the assessee under any provision of this Act in computing the income referred to in clause (a) of sub-section (1); and
(b) no set off of loss from transfer of the virtual digital asset computed under clause (a) of sub-section (1) shall be allowed against income computed under any other provision of this Act to the assessee and such loss shall not be allowed to be carried forward to succeeding
assessment years. "
Dated 24.03.2022 : Further to FM' s announcement of taxing cryptocurrency income from April 2022 . Government of India has added a new section 115BBH in the income tax act in the Finance Bill 2022 introduced in the parliament of India .
As per the new section 115BBH , Tax on cryptocurrency will be 30 % of cryptocurrency income , as announced in the Budget speech . But you cannot set off nor carry forward any loss incurred in a cryptocurrency trade or any other business as per the new section . Further it is now clarified that the loss made in a trade in one cryptocurrency cannot be set off against the profit made in other cryptocurrency trade , in a written clarification issued by Union Minister of State for Finance Pankaj Chaudhary in the Loksabha .
The new section 115BBH , as introduced in the Finance Bill 2022 , says
"
(1) Where the total income of an assessee includes any income from the transfer of any virtual digital asset, the income-tax payable shall be the aggregate of––
(a) the amount of income-tax calculated on the income from transfer of such virtual digital asset at the rate of 30% .; and
(b) the amount of income-tax with which the assessee would have been chargeable, had the total income of the assessee been reduced by the income referred to in clause (a).
(2) Notwithstanding anything contained in any other provision of this Act,––
(a) no deduction in respect of any expenditure (other than cost of acquisition) or allowance or set off of any loss shall be allowed to the assessee under any provision of this Act in computing the income referred to in clause (a) of sub-section (1); and
(b) no set off of loss from transfer of the virtual digital asset computed under clause (a) of sub-section (1) shall be allowed against income computed under any other provision of this Act to the assessee and such loss shall not be allowed to be carried forward to succeeding
assessment years. "
Editor's Note : Government of India has decided to tax cryptocurrency transactions and income . FM Ms Nirmala Sitharaman says taxing is not same as legalizing and it is yet to be finalized . She also says that both Government and RBI are discussing the matter and both are said be with the same opinion on cryptocurrencies . Now RBI Deputy Governor says that they can be neither regulated nor controlled . Hence he bats for banning of cryptocurrencies . We have to keep fingers crossed to know what finally our regulators decide .
BANNING OF CRYPTOCURRENCIES IS ADVISABLE : DG OF RBI
Dated 15.02.2022 : Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India , has advised ,in a Keynote address delivered yesterday at the Indian Banks Association 17th Annual Banking Technology Conference and Awards , that banning cryptocurrency is perhaps the most advisable choice open to India. He argued that crypto-technology is underpinned by a philosophy to evade Government controls. As Cryptocurrencies have specifically been developed to bypass the regulated financial system., it should be reason enough to treat them with caution. He continued " We have also seen that cryptocurrencies are not amenable to definition as a currency, asset or commodity; they have no underlying cash flows, they have no intrinsic value; that they are akin to Ponzi Schemes, and may even be worse. These should be reason enough to keep them away from the formal financial system. Additionally, they undermine financial integrity, especially the KYC regime and AML/CFT regulations and at least potentially facilitate anti-social activities. More substantially, they can (and if allowed most likely will) wreck the currency system, the monetary authority, the banking system, and in general Government’s ability to control the economy. They threaten the financial sovereignty of a country and make it susceptible to strategic manipulation by private corporates creating these currencies or Governments that control them" In view of these arguments , he concluded that banning cryptocurrency was perhaps the most advisable choice open to India.
In his speech , he touched some of the issues relating to cryptocurrencies and elaborated on the various aspects of cryptocurrencies of cryptocurrencies as below :
Characteristics of Cryptocurrencies :
1. cryptocurrencies are decentralized systems where transactions are authenticated by participants themselves by consensus. They are designed to bypass the financial system and all its controls. They cannot be traced or confiscated or frozen by Governments.
2. They are anonymous – transactions are verified, but not the purposes or counterparties of transactions.
3. They are borderless – that is, they work over the internet without any physical existence.
RBI DG 's arguments against cryptocurrency?
1. A cryptocurrency is designed to be a currency, but does it really function like a currency as we understand it. Firstly, currency always has an issuer, usually a trusted entity like the sovereign. Even when gold is used as a currency, the gold coins had to be issued by a sovereign entity. Secondly, historically, a currency has always been either a commodity with intrinsic value or a debt instrument. Cryptocurrencies do not conform to this understanding of a currency as they do not have an issuer, they are not an instrument of debt, or commodities nor do they have any intrinsic value. Currency needs trust, not everything that can be trusted is a currency. So even if technology (as in a blockchain) provides the trust for cryptocurrencies, they can at best perform the role of a currency within the private and closed environment of that cryptocurrency. They do not, and should not, automatically become a currency for the larger society.
2. Some countries tend to treat cryptocurrencies as a financial asset. This is also problematic because all financial assets have underlying cash flows and need to be some person’s liability. Cryptocurrencies are neither any person’s liability nor do they have any underlying cash flows. They are not financial assets, by definition.
3. There is also an effort to treat cryptocurrencies as a commodity. But commodities are tangible and have utility; cryptocurrencies have neither
4.Cryptocurrencies are very much like a speculative or gambling contract working like a Ponzi scheme.
5. The volatility of many cryptocurrencies precludes them as an efficient medium of exchange. Besides, a priori there is no ground to believe that people place the same trust in them as they do in legal tender currencies.
RISKS POSED TO SOCIETY BY ADVENT OF CRYPTOCURRENCIES :
Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India further dwells on the risks involved in using the cryptocurrencies as follows :
1. The fundamental risks of cryptocurrencies are two - they are intended to be private currencies and they are structured to evade Government control with respect to financial integrity standards such as KYC, AML/CFT etc. Let us examine each of these two points in a little more detail.
2. GOVERNMENTS LOSE ABILITY TO CONTROL THE ECONOMY : Historically, private currencies have resulted in instability and therefore have evolved into fiat currencies over centuries. The retrograde step back to private currencies cannot be taken simply because technology allows it (it always did, actually) without any consideration for the dislocation it causes to the legal, social and economic fabric of society. Every private currency will eventually replace the Rupee to some extent. Consequently, the role of the Rupee as a currency will be undermined. With one or more private currencies being allowed, there would be parallel currency system(s) in the country. Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy. Dollarization, it is well understood, would undermine the ability of authorities to control money supply or interest rates, as monetary policy would not have any impact on the non-Rupee currencies or payment instruments. When that happens, India loses not just its currency, a defining feature of its sovereignty, but its policy control of the economy. With loss of traction for monetary policy, the ability to control inflation would be materially weakened.
3. RISK TO FINANCIAL STABILITY : Given a choice, people may like to hold at least a part of their deposits in convertible currencies like the US Dollar or Euro. Cryptocurrencies priced in these convertible currencies would provide such an opportunity. If private currencies are permitted, the banking system’s ability to mobilise deposits in Rupees, and consequently, the ability to create credit, would diminished. Credit creation in convertible currencies would be impervious to monetary policy. In the extreme case where a major part of deposits and credit shift to cryptocurrencies, the result would be a weakened, even crumbling, banking system, impairing financial stability.
4. RISK TO CAPITAL MARKET : There are already indications that private cross-border flows are taking place in cryptocurrencies. If this trend is legitimised, a part of the flows related to trade payments, personal remittances or cross border investments would be made in these cryptocurrencies. As they are non-reserve currencies, this could have adverse implications for India’s foreign exchange reserves, which lend stability to the external sector. Besides, such cryptocurrency payments can take place outside the ambit of capital account regulations. This would adversely affect the integrity of the capital account regime, as policy control on capital flows would be eroded. The consequence of this on foreign exchange reserve accretion and exchange rate management raises serious macroeconomic stability issues.
5. It is important to appreciate that the concern with private currencies is not limited to bitcoin or just cryptocurrencies. The concern extends to any private currency, whether digital or physical, whether crypto-based or not. Stablecoins (which are simply cryptocurrencies that are less volatile) are being promoted globally, presumably because they are more stable than, say, bitcoin. We should in fact be more concerned about stablecoins because they would be more effective as currency than volatile cryptocurrencies.
6. ATTRACT ILLEGITAMATE TRANSACTIONS : The very raison d’etre of cryptocurrencies is that they bypass established intermediation and control arrangements that ensure integrity of financial transactions, such as Know-Your-Customer regimes, Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) rules etc. The fact that they are anonymous, decentralized systems that operate purely virtually makes cryptocurrencies particularly attractive to illegal/illegitimate transactions which have been largely filtered out of the formal financial system
Should Cryptocurrencies to be controlled and Regulated ?
The basic arguments being made for regulating cryptocurrencies are as follows:
Blockchain or Distributed Ledger Technology is a promising technology where Indians might have a global edge. Banning cryptocurrencies would affect the absorption of DLT technology in India. Most major countries are not banning cryptocurrencies, but are considering some kind of regulation. Many Indians have already invested in cryptocurrencies and banning it may lead to wealth loss for them. Banning in any case is unlikely to be effective because by its very nature cryptocurrencies can be acquired and traded in an anonymous manner.
However DG Mr Rabi Sankar dismisses the argument put forward by the proponents and comes to conclusion that it can neither be regulated by any financial sector regulator nor It is possible to regulate something that one cannot define.
In light of the reasons he puts forawrd , he concludes that the Best option for India is to ban them .
To read the complete speech of T . Rabi sankar , CLICK HERE
BANNING OF CRYPTOCURRENCIES IS ADVISABLE : DG OF RBI
Dated 15.02.2022 : Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India , has advised ,in a Keynote address delivered yesterday at the Indian Banks Association 17th Annual Banking Technology Conference and Awards , that banning cryptocurrency is perhaps the most advisable choice open to India. He argued that crypto-technology is underpinned by a philosophy to evade Government controls. As Cryptocurrencies have specifically been developed to bypass the regulated financial system., it should be reason enough to treat them with caution. He continued " We have also seen that cryptocurrencies are not amenable to definition as a currency, asset or commodity; they have no underlying cash flows, they have no intrinsic value; that they are akin to Ponzi Schemes, and may even be worse. These should be reason enough to keep them away from the formal financial system. Additionally, they undermine financial integrity, especially the KYC regime and AML/CFT regulations and at least potentially facilitate anti-social activities. More substantially, they can (and if allowed most likely will) wreck the currency system, the monetary authority, the banking system, and in general Government’s ability to control the economy. They threaten the financial sovereignty of a country and make it susceptible to strategic manipulation by private corporates creating these currencies or Governments that control them" In view of these arguments , he concluded that banning cryptocurrency was perhaps the most advisable choice open to India.
In his speech , he touched some of the issues relating to cryptocurrencies and elaborated on the various aspects of cryptocurrencies of cryptocurrencies as below :
Characteristics of Cryptocurrencies :
1. cryptocurrencies are decentralized systems where transactions are authenticated by participants themselves by consensus. They are designed to bypass the financial system and all its controls. They cannot be traced or confiscated or frozen by Governments.
2. They are anonymous – transactions are verified, but not the purposes or counterparties of transactions.
3. They are borderless – that is, they work over the internet without any physical existence.
RBI DG 's arguments against cryptocurrency?
1. A cryptocurrency is designed to be a currency, but does it really function like a currency as we understand it. Firstly, currency always has an issuer, usually a trusted entity like the sovereign. Even when gold is used as a currency, the gold coins had to be issued by a sovereign entity. Secondly, historically, a currency has always been either a commodity with intrinsic value or a debt instrument. Cryptocurrencies do not conform to this understanding of a currency as they do not have an issuer, they are not an instrument of debt, or commodities nor do they have any intrinsic value. Currency needs trust, not everything that can be trusted is a currency. So even if technology (as in a blockchain) provides the trust for cryptocurrencies, they can at best perform the role of a currency within the private and closed environment of that cryptocurrency. They do not, and should not, automatically become a currency for the larger society.
2. Some countries tend to treat cryptocurrencies as a financial asset. This is also problematic because all financial assets have underlying cash flows and need to be some person’s liability. Cryptocurrencies are neither any person’s liability nor do they have any underlying cash flows. They are not financial assets, by definition.
3. There is also an effort to treat cryptocurrencies as a commodity. But commodities are tangible and have utility; cryptocurrencies have neither
4.Cryptocurrencies are very much like a speculative or gambling contract working like a Ponzi scheme.
5. The volatility of many cryptocurrencies precludes them as an efficient medium of exchange. Besides, a priori there is no ground to believe that people place the same trust in them as they do in legal tender currencies.
RISKS POSED TO SOCIETY BY ADVENT OF CRYPTOCURRENCIES :
Shri T Rabi Sankar, Deputy Governor, Reserve Bank of India further dwells on the risks involved in using the cryptocurrencies as follows :
1. The fundamental risks of cryptocurrencies are two - they are intended to be private currencies and they are structured to evade Government control with respect to financial integrity standards such as KYC, AML/CFT etc. Let us examine each of these two points in a little more detail.
2. GOVERNMENTS LOSE ABILITY TO CONTROL THE ECONOMY : Historically, private currencies have resulted in instability and therefore have evolved into fiat currencies over centuries. The retrograde step back to private currencies cannot be taken simply because technology allows it (it always did, actually) without any consideration for the dislocation it causes to the legal, social and economic fabric of society. Every private currency will eventually replace the Rupee to some extent. Consequently, the role of the Rupee as a currency will be undermined. With one or more private currencies being allowed, there would be parallel currency system(s) in the country. Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy. Dollarization, it is well understood, would undermine the ability of authorities to control money supply or interest rates, as monetary policy would not have any impact on the non-Rupee currencies or payment instruments. When that happens, India loses not just its currency, a defining feature of its sovereignty, but its policy control of the economy. With loss of traction for monetary policy, the ability to control inflation would be materially weakened.
3. RISK TO FINANCIAL STABILITY : Given a choice, people may like to hold at least a part of their deposits in convertible currencies like the US Dollar or Euro. Cryptocurrencies priced in these convertible currencies would provide such an opportunity. If private currencies are permitted, the banking system’s ability to mobilise deposits in Rupees, and consequently, the ability to create credit, would diminished. Credit creation in convertible currencies would be impervious to monetary policy. In the extreme case where a major part of deposits and credit shift to cryptocurrencies, the result would be a weakened, even crumbling, banking system, impairing financial stability.
4. RISK TO CAPITAL MARKET : There are already indications that private cross-border flows are taking place in cryptocurrencies. If this trend is legitimised, a part of the flows related to trade payments, personal remittances or cross border investments would be made in these cryptocurrencies. As they are non-reserve currencies, this could have adverse implications for India’s foreign exchange reserves, which lend stability to the external sector. Besides, such cryptocurrency payments can take place outside the ambit of capital account regulations. This would adversely affect the integrity of the capital account regime, as policy control on capital flows would be eroded. The consequence of this on foreign exchange reserve accretion and exchange rate management raises serious macroeconomic stability issues.
5. It is important to appreciate that the concern with private currencies is not limited to bitcoin or just cryptocurrencies. The concern extends to any private currency, whether digital or physical, whether crypto-based or not. Stablecoins (which are simply cryptocurrencies that are less volatile) are being promoted globally, presumably because they are more stable than, say, bitcoin. We should in fact be more concerned about stablecoins because they would be more effective as currency than volatile cryptocurrencies.
6. ATTRACT ILLEGITAMATE TRANSACTIONS : The very raison d’etre of cryptocurrencies is that they bypass established intermediation and control arrangements that ensure integrity of financial transactions, such as Know-Your-Customer regimes, Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) rules etc. The fact that they are anonymous, decentralized systems that operate purely virtually makes cryptocurrencies particularly attractive to illegal/illegitimate transactions which have been largely filtered out of the formal financial system
Should Cryptocurrencies to be controlled and Regulated ?
The basic arguments being made for regulating cryptocurrencies are as follows:
Blockchain or Distributed Ledger Technology is a promising technology where Indians might have a global edge. Banning cryptocurrencies would affect the absorption of DLT technology in India. Most major countries are not banning cryptocurrencies, but are considering some kind of regulation. Many Indians have already invested in cryptocurrencies and banning it may lead to wealth loss for them. Banning in any case is unlikely to be effective because by its very nature cryptocurrencies can be acquired and traded in an anonymous manner.
However DG Mr Rabi Sankar dismisses the argument put forward by the proponents and comes to conclusion that it can neither be regulated by any financial sector regulator nor It is possible to regulate something that one cannot define.
In light of the reasons he puts forawrd , he concludes that the Best option for India is to ban them .
To read the complete speech of T . Rabi sankar , CLICK HERE
LEGALITY OF TRADING OF BITCOINS IN INDIA . Is Bitcoin trading legal in india ?
Are cryptocurrencies legal in India now ?
Dated 11.02.2022 : RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . In March 2020 , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India had lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India . No guidelines had been issued by RBI after Supreme Court decision , though the statements of present Governor of RBI weighs heavily against allowing cryptocurrencies . Many central banks around the world have taken similar stands , as they think monetary system is their exclusive domain .
In December 2021 , Government of India wanted to bring a bill in the parliament proposing a bill to ban / regulate cryptocurrencies . . But the proposed bill was not placed for the consideration of loksabha in the last winter session .
Now in the present budget proposed by the Finance Minister for FY 2022-23 , FM has proposed to tax on cryptocurrency income at 30 % and a TDS at 1 % on cryptocurrency transactions . But still the government has not come out with a policy / law clarifying the legal status of the cryptocurrencies . In one of the TV interviews post budget , FM stated that the legality issue will be taken later and taxing cryptocurrencies is a different issue .
Whether taxing of income and transactions indicates the tacit approval of the government ? Whether it is one step forward toward recognizing the cryptocurrencies ? Government is not clear and FM has told that just discussion on illegalizing is still go on .
We have to wait how the issue will be taken further by RBI and the Government of India
Dated 11.02.2022 : RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . In March 2020 , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India had lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India . No guidelines had been issued by RBI after Supreme Court decision , though the statements of present Governor of RBI weighs heavily against allowing cryptocurrencies . Many central banks around the world have taken similar stands , as they think monetary system is their exclusive domain .
In December 2021 , Government of India wanted to bring a bill in the parliament proposing a bill to ban / regulate cryptocurrencies . . But the proposed bill was not placed for the consideration of loksabha in the last winter session .
Now in the present budget proposed by the Finance Minister for FY 2022-23 , FM has proposed to tax on cryptocurrency income at 30 % and a TDS at 1 % on cryptocurrency transactions . But still the government has not come out with a policy / law clarifying the legal status of the cryptocurrencies . In one of the TV interviews post budget , FM stated that the legality issue will be taken later and taxing cryptocurrencies is a different issue .
Whether taxing of income and transactions indicates the tacit approval of the government ? Whether it is one step forward toward recognizing the cryptocurrencies ? Government is not clear and FM has told that just discussion on illegalizing is still go on .
We have to wait how the issue will be taken further by RBI and the Government of India
India to Tax Cryptocurrency Income
VIRTUAL CURRENCY TAX :
In the budget speech on 01.02.2022 , Indian Finance Minister Ms Nirmala Sitharaman announced that India is going to TAX INCOME FROM THE CRYPTOCURRENCIES AT A FLAT RATE OF 30 % . No deduction is allowed except the cost of acquisition . Further TDS of 1 % will be collected on the amount of transaction in virtual currencies . Receiver of gifts of virtual currency will be taxed .
She told " I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30 per cent. No deduction in respect of any expenditure or allowance shall be allowed while computing such income except cost of acquisition. Further, loss from transfer of virtual digital asset cannot be set off against any other income. Further, in order to capture the transaction details, I also propose to provide for TDS on payment made in relation to transfer of virtual digital asset at the rate of 1 per cent of such consideration above a monetary threshold. Gift of virtual digital asset is also proposed to be taxed in the hands of the recipient "
In the budget speech on 01.02.2022 , Indian Finance Minister Ms Nirmala Sitharaman announced that India is going to TAX INCOME FROM THE CRYPTOCURRENCIES AT A FLAT RATE OF 30 % . No deduction is allowed except the cost of acquisition . Further TDS of 1 % will be collected on the amount of transaction in virtual currencies . Receiver of gifts of virtual currency will be taxed .
She told " I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30 per cent. No deduction in respect of any expenditure or allowance shall be allowed while computing such income except cost of acquisition. Further, loss from transfer of virtual digital asset cannot be set off against any other income. Further, in order to capture the transaction details, I also propose to provide for TDS on payment made in relation to transfer of virtual digital asset at the rate of 1 per cent of such consideration above a monetary threshold. Gift of virtual digital asset is also proposed to be taxed in the hands of the recipient "
DRAFT BILL TO BAN CRYPTOCURRENCIES IN INDIA
Dated 25.11.2201 : Government of India is tabling a bill which prohibits all activities related to cryptocurrencies in the territory of India for the approval of Parliament during this winter session .
As per the draft bill , No person shall mine, generate, hold, sell, deal in, issue, transfer, dispose of or use Cryptocurrency in the territory of India. The draft Bill bans the use of cryptocurrency as legal tender or currency. Mining is an activity aimed at creating a cryptocurrency and/or validating cryptocurrency transactions between a buyer and seller.
Under the proposed law , contravention is punishable with a fine or imprisonment of up to 10 years, or both. Further issuing any advertisement, soliciting, assisting or inducing participation in use of cryptocurrency is punishable with a fine or imprisonment of up to seven years, or both. Acquiring, storing or disposing of cryptocurrency with the intent of using it for non-commercial purposes will be punishable with a fine.
Further India Government may , in consultation with the central board of the RBI, approve digital rupee to be legal tender. The RBI may also notify a foreign digital currency as a foreign currency. Foreign digital currency means a digital currency recognised as legal tender in a foreign jurisdiction.
It is estimated that more than 10 crore Indians are presently having cryptocurrency accounts . It is also estimated that there are more than 6,000 cryptocurrencies are in the world .
The existing cryptocurrency holders in India will get 90 days time to off-load their holdings .
Present Legal position of Cryptocurrencies in India :
RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . In March 2020 , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India had lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India . No guidelines had been issued by RBI after Supreme Court decision . Now after a gap of 22 months , Government of India is proposing the above bill to ban cryptos .
Position in other countries : El Salvador has made the leading cryptocurrency Bitcoin as its legal tender . Some Asian countries like China , Thailand , Indonesia have banned the use of cryptocurrencies . Some countries like USA and Japan have permitted the use with restrictions . Some European countries are regulating the use .
One can read the complete draft of the bill in the website of PRS India
Dated 25.11.2201 : Government of India is tabling a bill which prohibits all activities related to cryptocurrencies in the territory of India for the approval of Parliament during this winter session .
As per the draft bill , No person shall mine, generate, hold, sell, deal in, issue, transfer, dispose of or use Cryptocurrency in the territory of India. The draft Bill bans the use of cryptocurrency as legal tender or currency. Mining is an activity aimed at creating a cryptocurrency and/or validating cryptocurrency transactions between a buyer and seller.
Under the proposed law , contravention is punishable with a fine or imprisonment of up to 10 years, or both. Further issuing any advertisement, soliciting, assisting or inducing participation in use of cryptocurrency is punishable with a fine or imprisonment of up to seven years, or both. Acquiring, storing or disposing of cryptocurrency with the intent of using it for non-commercial purposes will be punishable with a fine.
Further India Government may , in consultation with the central board of the RBI, approve digital rupee to be legal tender. The RBI may also notify a foreign digital currency as a foreign currency. Foreign digital currency means a digital currency recognised as legal tender in a foreign jurisdiction.
It is estimated that more than 10 crore Indians are presently having cryptocurrency accounts . It is also estimated that there are more than 6,000 cryptocurrencies are in the world .
The existing cryptocurrency holders in India will get 90 days time to off-load their holdings .
Present Legal position of Cryptocurrencies in India :
RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . In March 2020 , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India had lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India . No guidelines had been issued by RBI after Supreme Court decision . Now after a gap of 22 months , Government of India is proposing the above bill to ban cryptos .
Position in other countries : El Salvador has made the leading cryptocurrency Bitcoin as its legal tender . Some Asian countries like China , Thailand , Indonesia have banned the use of cryptocurrencies . Some countries like USA and Japan have permitted the use with restrictions . Some European countries are regulating the use .
One can read the complete draft of the bill in the website of PRS India
BITCOIN PRICES AT ALL TIME HIGH
BITCOIN PRICE CREATES A NEW PEAK AGAINST USD :
DATED 10.11.2021 : Bitcoin has established a new peak of USD 68,262.70 per piece again YESTERDAY and it's now at around USD 66,380 . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
In spite of violent fluctuation in values of the currency , it's becoming more and more popular with Indians with large amount of investments reported there in Bitcoin market .
What a remarkable price journey for a currency which was valued just 0.6 USD per BTC in 2009 when it started trading .
DATED 10.11.2021 : Bitcoin has established a new peak of USD 68,262.70 per piece again YESTERDAY and it's now at around USD 66,380 . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
In spite of violent fluctuation in values of the currency , it's becoming more and more popular with Indians with large amount of investments reported there in Bitcoin market .
What a remarkable price journey for a currency which was valued just 0.6 USD per BTC in 2009 when it started trading .
BITCOIN PRICE CREATES A NEW ALL TIME HIGH AGAINST USD :
DATED 22.10.2021 : Bitcoin has established a new peak of USD 66,974.77 per piece again YESTERDAY and it's now at around USD 63,300 . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
DATED 22.10.2021 : Bitcoin has established a new peak of USD 66,974.77 per piece again YESTERDAY and it's now at around USD 63,300 . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
BITCOIN PRICE CROSSES USD 60K AGAIN :
DATED 17.10.2021 : Bitcoin has crossed USD 60,000 per piece again and it's now at around USD 60,914 . During the day Bitcoin reached USD 62,200 before retracing to current levels . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
DATED 17.10.2021 : Bitcoin has crossed USD 60,000 per piece again and it's now at around USD 60,914 . During the day Bitcoin reached USD 62,200 before retracing to current levels . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . During April 2021 , Bitcoin price had reached its all time high of USD 64,888 and subsequently it had fallen to level of USD 30,000 in the first week of July2021 . Now again the price has retraced to the current level .
BITCOIN IS NOW NATIONAL CURRENCY OF EL SALVADOR :
Dated 08.09.2021 : The president of Central American nation El Salvador Mr Nayib Bukele announced yesterday that the country will adopt Bitcoins as National currency , along with the present recognized currency U S Dollars . El Salvador is the first country in the world to make Bitcoins or any other cryptocurrency as a legal tender .
It is reported that El Salvador bought 200 Bitcoins on the eve of making it a national currency . It is reported that the government is planning to gift USD30 equivalent Bitcoins to its citizens who opt to open Bitcoin accounts . The government has also developed an APP called "Chivo Wallet," to store Bitcoins by its citizens . The application created by the government will deliver $30 worth of bitcoin to people to promote its use. Chivo wallet easy conversion of USD to Bitcoins and vice versa . One can download the App at https://apkglobe.com/en/chivo-wallet-apk/download/15656
In meantime value of Bitcoin against USD crashed around 10 % yesterday and it is trading at USD 46,600 . We have to wait and see how the central American country will be able to manage its economy with a highly volatile virtual currency as current economic situation of the country is not rosy at all .
Dated 08.09.2021 : The president of Central American nation El Salvador Mr Nayib Bukele announced yesterday that the country will adopt Bitcoins as National currency , along with the present recognized currency U S Dollars . El Salvador is the first country in the world to make Bitcoins or any other cryptocurrency as a legal tender .
It is reported that El Salvador bought 200 Bitcoins on the eve of making it a national currency . It is reported that the government is planning to gift USD30 equivalent Bitcoins to its citizens who opt to open Bitcoin accounts . The government has also developed an APP called "Chivo Wallet," to store Bitcoins by its citizens . The application created by the government will deliver $30 worth of bitcoin to people to promote its use. Chivo wallet easy conversion of USD to Bitcoins and vice versa . One can download the App at https://apkglobe.com/en/chivo-wallet-apk/download/15656
In meantime value of Bitcoin against USD crashed around 10 % yesterday and it is trading at USD 46,600 . We have to wait and see how the central American country will be able to manage its economy with a highly volatile virtual currency as current economic situation of the country is not rosy at all .
NO ADDITIONAL KYC REQUIRED FOR CRYPTOCURRENCY TRANSACTIONS : RBI CLARIFIES
Dated 01.06.2021 : It was reported by many newspapers and portals that some banks have warned their clients now against cryptocurrency transactions quoting RBI circular RBI circular DBR.No.BP.BC.104/08.13.102/2017-18 dated April 06, 2018 . The said order has already been set aside by the Supreme court in March 20 . Hence Reserve bank of India has asked banks not to take any action based on the basis of said circular . The clarification confirms that banks cannot restrict the cryptocurrency transactions of their clients on the basis of RBI'S earlier ban .
However Reserve Bank of India has asked Banks to continue to carry out usual customer due diligence processes in line with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT) and obligations of regulated entities under Prevention of Money Laundering Act, (PMLA), 2002 in addition to ensuring compliance with relevant provisions under Foreign Exchange Management Act (FEMA) for overseas remittances. Hence it is clear now that banks cannot prevent Bitcoin transactions in KYC compliant accounts with them .
For RBI Notification dated 31.05.22021 , CLICK HERE
Dated 01.06.2021 : It was reported by many newspapers and portals that some banks have warned their clients now against cryptocurrency transactions quoting RBI circular RBI circular DBR.No.BP.BC.104/08.13.102/2017-18 dated April 06, 2018 . The said order has already been set aside by the Supreme court in March 20 . Hence Reserve bank of India has asked banks not to take any action based on the basis of said circular . The clarification confirms that banks cannot restrict the cryptocurrency transactions of their clients on the basis of RBI'S earlier ban .
However Reserve Bank of India has asked Banks to continue to carry out usual customer due diligence processes in line with regulations governing standards for Know Your Customer (KYC), Anti-Money Laundering (AML), Combating of Financing of Terrorism (CFT) and obligations of regulated entities under Prevention of Money Laundering Act, (PMLA), 2002 in addition to ensuring compliance with relevant provisions under Foreign Exchange Management Act (FEMA) for overseas remittances. Hence it is clear now that banks cannot prevent Bitcoin transactions in KYC compliant accounts with them .
For RBI Notification dated 31.05.22021 , CLICK HERE
BITCOIN MAKES NEW PEAK AT USD 61,500 :
DATED 14.03.2021 : Bitcoin has crossed USD 60,000 per piece and it's now at around USD 60,780 . During the day Bitcoin reached a new peak of USD 61,556 before retracing to current levels . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . The victory march of Bitcoin is continuing in the month of March also .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
What a remarkable price journey for a currency which was valued just 0.6 USD per BTC in 2009 when it started trading .
DATED 14.03.2021 : Bitcoin has crossed USD 60,000 per piece and it's now at around USD 60,780 . During the day Bitcoin reached a new peak of USD 61,556 before retracing to current levels . During 2021 , BTC has more than doubled its value from yearend peak of USD 29,390 . The victory march of Bitcoin is continuing in the month of March also .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
What a remarkable price journey for a currency which was valued just 0.6 USD per BTC in 2009 when it started trading .
LEADING CRYPTOCURRENCY PRICES INCLUDING BITCOIN PRICE IN INDIA CURRENCY INDIAN RUPEES
BITCOIN AND OTHER CRYPTOCURRENCIES PRICES IN INDIAN RUPEES NOW LIVE -BTC TO INR
HAVE OPEN MIND ON CRYPTOCURRENCIES : MOSF GOVERNMENT OF INDIA
Dated 07.03.2021 : While speaking at the Entreprenuers Organisation - Punjab Chapter. yesterday , Mr Anurag Thakur , Minister of State ( Finance ), Government of India has called for evaluation of cryptocurrencies and the other new ideas on the block chain technology with an open mind .
He advised that a High-Level Inter-Ministerial Committee has been constituted and Government would take a decision on the recommendations of the committee and the legislative proposal, if any, would be introduced in the Parliament following the due process .
However he has batted for encouraging the new ideas with open mind . He also told that even PM Narendra Modi is also a strong advocate of embracing technology in various aspects of governance.
Actually the details of the committee report is not made public and market was abuzz with rumours of banning of private cryptocurrencies in India . However the words of the minister indicate that still the government has not decided to curtain down on the cryptocurrencies like Bitcoin and investors in these currencies in India may relax for now .
Source : Twitter account of MOSF
Dated 07.03.2021 : While speaking at the Entreprenuers Organisation - Punjab Chapter. yesterday , Mr Anurag Thakur , Minister of State ( Finance ), Government of India has called for evaluation of cryptocurrencies and the other new ideas on the block chain technology with an open mind .
He advised that a High-Level Inter-Ministerial Committee has been constituted and Government would take a decision on the recommendations of the committee and the legislative proposal, if any, would be introduced in the Parliament following the due process .
However he has batted for encouraging the new ideas with open mind . He also told that even PM Narendra Modi is also a strong advocate of embracing technology in various aspects of governance.
Actually the details of the committee report is not made public and market was abuzz with rumours of banning of private cryptocurrencies in India . However the words of the minister indicate that still the government has not decided to curtain down on the cryptocurrencies like Bitcoin and investors in these currencies in India may relax for now .
Source : Twitter account of MOSF
FUTURE OF BITCOINS IN INDIA
FUTURE OF CRYPTOCURRENCIES IN THE WORLD AND IN INDIA
Dated 21.12.2021 : It's reported that there are more than 3000 cryptocurrencies in the world and the most popular by market cap and price is the Bitcoin ( BTC ) . Many Governments are Central banks are mulling idea of creating their own new cryptocurrencies ( Eg : China , India ) .
The trading in Bitcoins started in 2009 at a nominal price of 1BTC = USD 0.60 . From thereon its prices surged and crashed many times . But it's touching new peaks after falls and have raced to its peak now . In the current surge , the price of Bitcoin is reaching higher and higher day by day , especially from the year 2020 and now the price is at around USD 56,000 per piece . Its market cap has crossed USD 1 trillion .
Once it was thought that Bitcoins were fit for use only for black marketers , illegal traders and black money holders . It was rumoured that Indian black money holders were responsible for surge in BTC prices in 2016 after demonetization of Indian currencies . Initially buying a pizza by paying 10 Bitcoins was an achievement . As cryptocurrencies do not require / have a central authority , many were afraid to deal with them as no one knew whom to approach in case of a problem . Earlier cryptocurrencies were treated as fringe currencies and risky one suitable only for gambling , as their values gyrated up and down .
Now scenario has changed . Now many regular commercial entities have begin to recognize the value of them . Many banks in the world are opening Bitcoin bank accounts 9 Eg : Goldman Sachs , USA , Chime Bank USA , National Bank of Canada Bitcoin debit and credit cards are being issued on Visa Platform . Many commercial entities are like Microsoft , Pizzahut , shopify , Expedia are accepting Bitcoins for their billing payments . Tesla , famous auto maker , has disclosed that they have bought Bitcoins worth USD 1.5 BILLION.
All the developments that have happened in 2020 / 21 in the world are pointing that cryptocurrencies are gaining grounds , respectability and value and they are going to stay . While volatility may still keep safe investors away .
FUTURE OF CRPTOCURRENCIES IN INDIA : While the world is moving with the new forms of virtual currencies , the future of cryptocurrencies in India is uncertain . Already a cryptocurrency bank is opened in India . While Reserve bank of India has announced that they are toying with the idea of own cryptocurrency , government is in the process of forming a new law to deal with them .
With the rumour of banning of existing private cryptocurrencies by the new law gaining grounds , investors are facing doldrums . It's estimated by some in the cryptocurrency business that Indians have invested more than USD 1 Billion in the Bitcoin market . No one is sure whether to hold Bitcoins or not . Investors who have already invested in Bitcoins are worried whether they would be able to encash them in case of banning by the Government . It is now to be seen whether the Government will ban the private cryptocurrencies or allow and regulate the cryptocurrency business and services in India . It is also to be seen how RBI will bring out our own cryptocurrency and with what features , terms & conditions . Hopefully , government will come out with the new bill on crptocurrencies to clear the air about future of bitcoin and other cryptocurrencies in India .
Dated 21.12.2021 : It's reported that there are more than 3000 cryptocurrencies in the world and the most popular by market cap and price is the Bitcoin ( BTC ) . Many Governments are Central banks are mulling idea of creating their own new cryptocurrencies ( Eg : China , India ) .
The trading in Bitcoins started in 2009 at a nominal price of 1BTC = USD 0.60 . From thereon its prices surged and crashed many times . But it's touching new peaks after falls and have raced to its peak now . In the current surge , the price of Bitcoin is reaching higher and higher day by day , especially from the year 2020 and now the price is at around USD 56,000 per piece . Its market cap has crossed USD 1 trillion .
Once it was thought that Bitcoins were fit for use only for black marketers , illegal traders and black money holders . It was rumoured that Indian black money holders were responsible for surge in BTC prices in 2016 after demonetization of Indian currencies . Initially buying a pizza by paying 10 Bitcoins was an achievement . As cryptocurrencies do not require / have a central authority , many were afraid to deal with them as no one knew whom to approach in case of a problem . Earlier cryptocurrencies were treated as fringe currencies and risky one suitable only for gambling , as their values gyrated up and down .
Now scenario has changed . Now many regular commercial entities have begin to recognize the value of them . Many banks in the world are opening Bitcoin bank accounts 9 Eg : Goldman Sachs , USA , Chime Bank USA , National Bank of Canada Bitcoin debit and credit cards are being issued on Visa Platform . Many commercial entities are like Microsoft , Pizzahut , shopify , Expedia are accepting Bitcoins for their billing payments . Tesla , famous auto maker , has disclosed that they have bought Bitcoins worth USD 1.5 BILLION.
All the developments that have happened in 2020 / 21 in the world are pointing that cryptocurrencies are gaining grounds , respectability and value and they are going to stay . While volatility may still keep safe investors away .
FUTURE OF CRPTOCURRENCIES IN INDIA : While the world is moving with the new forms of virtual currencies , the future of cryptocurrencies in India is uncertain . Already a cryptocurrency bank is opened in India . While Reserve bank of India has announced that they are toying with the idea of own cryptocurrency , government is in the process of forming a new law to deal with them .
With the rumour of banning of existing private cryptocurrencies by the new law gaining grounds , investors are facing doldrums . It's estimated by some in the cryptocurrency business that Indians have invested more than USD 1 Billion in the Bitcoin market . No one is sure whether to hold Bitcoins or not . Investors who have already invested in Bitcoins are worried whether they would be able to encash them in case of banning by the Government . It is now to be seen whether the Government will ban the private cryptocurrencies or allow and regulate the cryptocurrency business and services in India . It is also to be seen how RBI will bring out our own cryptocurrency and with what features , terms & conditions . Hopefully , government will come out with the new bill on crptocurrencies to clear the air about future of bitcoin and other cryptocurrencies in India .
INDIA TO BRING FRESH LAW ON CRYPTOCURRENCIES :
Dated 19.02.2021 : In an interview with a journalist yesterday ( of ETV ) , the state Minister for Finance Mr Anurag Thakur informed that Indian Government is in the process of bringing a new bill on cryptocurrencies . He informed that the government had formed an inter-ministerial committee on the issue which has given its report. Thereafter, a group of secretaries in the leadership of cabinet secretary have also submitted its report which will be submitted to the Union cabinet. If the Cabinet approves it then the government may introduce a cryptocurrency bill in the current session of the parliament to enact a law to regulate cryptocurrencies in the country.
Dated 19.02.2021 : In an interview with a journalist yesterday ( of ETV ) , the state Minister for Finance Mr Anurag Thakur informed that Indian Government is in the process of bringing a new bill on cryptocurrencies . He informed that the government had formed an inter-ministerial committee on the issue which has given its report. Thereafter, a group of secretaries in the leadership of cabinet secretary have also submitted its report which will be submitted to the Union cabinet. If the Cabinet approves it then the government may introduce a cryptocurrency bill in the current session of the parliament to enact a law to regulate cryptocurrencies in the country.
INDIA EXPLORING ITS OWN CRYPTOCURRENCY :
Dated 26.01.2021 : Reserve Bank Of India ( RBI ) had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . However the Supreme court of India , had lifted the ban imposed by Reserve Bank of India in 2020 . Further there is no legal development in India .
Now RBI , in a booklet published on payment systems in India , has advised that it is exploring the possibility as to whether there is a need for a digital version of fiat currency ( cash or Rupee notes ) and in case there is, then how to operationalise it. It has also noted that regulators and governments in India have been sceptical about these currencies and are apprehensive about the associated risks so far .
In case RBI finds and adopts and brings out a new digital currency which can be converted to Indian rupee , it will be saving on printing , storing , transportation and managing notes and coins which is having a sizable cost now . General public may also feel ease in having and using such currencies . While in one hand people will be safe from theft , counting , accounting and managing cash , they have to be careful of cybertheft , hacking , phishing attempts and other crimes connected with cyber world . Password maintenance will be the other headache to be encountered by the public .
We have to wait and see how RBI move takes shape in the future .
To know various alternate payment system available in India , go through the RBI BOOKLET
Dated 26.01.2021 : Reserve Bank Of India ( RBI ) had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . However the Supreme court of India , had lifted the ban imposed by Reserve Bank of India in 2020 . Further there is no legal development in India .
Now RBI , in a booklet published on payment systems in India , has advised that it is exploring the possibility as to whether there is a need for a digital version of fiat currency ( cash or Rupee notes ) and in case there is, then how to operationalise it. It has also noted that regulators and governments in India have been sceptical about these currencies and are apprehensive about the associated risks so far .
In case RBI finds and adopts and brings out a new digital currency which can be converted to Indian rupee , it will be saving on printing , storing , transportation and managing notes and coins which is having a sizable cost now . General public may also feel ease in having and using such currencies . While in one hand people will be safe from theft , counting , accounting and managing cash , they have to be careful of cybertheft , hacking , phishing attempts and other crimes connected with cyber world . Password maintenance will be the other headache to be encountered by the public .
We have to wait and see how RBI move takes shape in the future .
To know various alternate payment system available in India , go through the RBI BOOKLET
UNICAS , FIRST BITCOIN BANK IN INDIA
FIRST BITCOIN BANK STARTS OPERATION IN INDIA
14.01.2021 : A crypto bank called UNICAS has started its operations in India with physical branches through a joint venture between Cashaa , a London based cryptocurrency platform and United Multistate co-op society , Mumbai based co-operative society . Customers of the bank can open bank accounts, buy and sell cryptocurrencies, obtain crypto-backed loans, as well as learn about crypto. The bank pays interest on the cryptocurrency accounts .
Customers of the bank can also maintain crypto savings accounts with Unicas and get interest in the same cryptocurrency as the deposit. For instance a bitcoin deposit will get interest in bitcoin. For rupee loans against crypto, the cryptocurrency has to be deposited in the wallet as collateral and bank promises the instantaneous approval . The deposit acts as lien in case of default.
It has opened a branch in Jaipur , Rajastan offering cryptocurrency services and said to be the first physical bank branch in the world to offer such services . It is reported that the parent society has more than 56 ,000 customers with 16 branches in Maharashtra , Rajastan , Delhi and Gujarat . Unicas is using the regulatory licences issued to parent co-op society to enter Indian business .
Unicas is offering various cryptocurrencies that include Bitcoin ( BTC) , Ether ( ETC ) , Cashaa ( CAS ) & XRP for savings accounts and loans .
Presently there is a legal vacuum in India with regard to legality of cryptocurrencies , after Supreme Court lifted than earlier ban imposed by RBI . Subsequently no law or order has been passed by the government . One has also have to keep in mind the risks involved in investing including volatility of the market before dealing in cryptocurrencies .
TO visit the website of the bank , CLICK HERE
14.01.2021 : A crypto bank called UNICAS has started its operations in India with physical branches through a joint venture between Cashaa , a London based cryptocurrency platform and United Multistate co-op society , Mumbai based co-operative society . Customers of the bank can open bank accounts, buy and sell cryptocurrencies, obtain crypto-backed loans, as well as learn about crypto. The bank pays interest on the cryptocurrency accounts .
Customers of the bank can also maintain crypto savings accounts with Unicas and get interest in the same cryptocurrency as the deposit. For instance a bitcoin deposit will get interest in bitcoin. For rupee loans against crypto, the cryptocurrency has to be deposited in the wallet as collateral and bank promises the instantaneous approval . The deposit acts as lien in case of default.
It has opened a branch in Jaipur , Rajastan offering cryptocurrency services and said to be the first physical bank branch in the world to offer such services . It is reported that the parent society has more than 56 ,000 customers with 16 branches in Maharashtra , Rajastan , Delhi and Gujarat . Unicas is using the regulatory licences issued to parent co-op society to enter Indian business .
Unicas is offering various cryptocurrencies that include Bitcoin ( BTC) , Ether ( ETC ) , Cashaa ( CAS ) & XRP for savings accounts and loans .
Presently there is a legal vacuum in India with regard to legality of cryptocurrencies , after Supreme Court lifted than earlier ban imposed by RBI . Subsequently no law or order has been passed by the government . One has also have to keep in mind the risks involved in investing including volatility of the market before dealing in cryptocurrencies .
TO visit the website of the bank , CLICK HERE
BITCOIN PRICE IS MARCHING TOWARDS USD 50,000 :
DATED 19.02.2021 : Bitcoin has crossed USD 50,000 per piece and it's now at around USD 51,665 . During the last one month , it has raised from USD 33,000 to this level and it's now crossed USD 50,000 . New peak are reached almost every week during the current year . During 2021 , BTC gained more than 7,000 per BTC in the first week of 2021 from yearend peak of USD 29,390 . The march continued and now it has gained more than 50 % from the last year end price .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
DATED 19.02.2021 : Bitcoin has crossed USD 50,000 per piece and it's now at around USD 51,665 . During the last one month , it has raised from USD 33,000 to this level and it's now crossed USD 50,000 . New peak are reached almost every week during the current year . During 2021 , BTC gained more than 7,000 per BTC in the first week of 2021 from yearend peak of USD 29,390 . The march continued and now it has gained more than 50 % from the last year end price .
The last year (2020 ) had also given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
BITCOIN PRICE CROSSES USD 37,000 TODAY :
DATED 07.01.2021 : Bitcoin reached new peaks to day and crossed USD 37,000 per BTC . BTC has gained more than 7,000 per BTC in the first week of 2021 from yearend peak of USD 29,390 .
The year 2020 had given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
DATED 07.01.2021 : Bitcoin reached new peaks to day and crossed USD 37,000 per BTC . BTC has gained more than 7,000 per BTC in the first week of 2021 from yearend peak of USD 29,390 .
The year 2020 had given a bumper return of more than 300 % to the investors in Bitcoin ( BTC ) as its prices peaked to USD 29,390 . Bitcoin prices were at USD 7,200 in January1st , 2020 .
BITCOIN PRICES ARE AT HISTORICAL PEAK AND CROSS USD 22,000 :
DATED 17.12.2020 : Today Bitcoin ( BTC ) prices peaked to USD 22,100 AGAINST THE ALL TIME HIGH OF USD 19, 665 . Now ( IST 11.25 AM ) it is trading at USD 22,103 ( INR 16,22, 390 ) . The earlier peak of USD 19,665 was reached in December 2017 and fell to USD 3,194 in December 2018 .
Bitcoin was struggling to break earlier peak for more than a month and finally it has broken the earlier record .
DATED 17.12.2020 : Today Bitcoin ( BTC ) prices peaked to USD 22,100 AGAINST THE ALL TIME HIGH OF USD 19, 665 . Now ( IST 11.25 AM ) it is trading at USD 22,103 ( INR 16,22, 390 ) . The earlier peak of USD 19,665 was reached in December 2017 and fell to USD 3,194 in December 2018 .
Bitcoin was struggling to break earlier peak for more than a month and finally it has broken the earlier record .
WHAT IS BITCOIN ? WHAT IS A CRYPTO CURRENCY ?
To know all about them , CLICK HERE
To know all about them , CLICK HERE
SUPREME COURT QUASHES RBI BAN ON BITCOIN TRANSACTIONS
Dated 04.03.2020 : Today , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India .
RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies .
We have to wait for detailed judgement and revised RBI guidelines in the matter .
Updated dated 29.04.2021 : No guidelines has been issued by RBI so far . A new legislation is said to be under preparation / review by the Government of India . Though there are many rumours , no official announcement is done so far .
Source : Media
Dated 04.03.2020 : Today , the Supreme court of India , disposing of a writ petition filed by Internet and Mobile Association of India lifted the ban imposed by Reserve Bank of India in 2018 on Bitcoin and other cryptocurrency Trading in India .
RBI had in 2018 prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies .
We have to wait for detailed judgement and revised RBI guidelines in the matter .
Updated dated 29.04.2021 : No guidelines has been issued by RBI so far . A new legislation is said to be under preparation / review by the Government of India . Though there are many rumours , no official announcement is done so far .
Source : Media
RESERVE BANK OF INDIA PROHIBITS SERVICE TO BITCOIN TRANSACTIONS BY BANKS AND OTHER REGULATED ENTITIES
Dated 05.04.2018 : Reserve Bank of India today prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . The ban comes in to effect with immediate effect . All the entities which are providing such facilities have to exit in time bound manner . RBI will issue a circular shortly .
The ban virtually ends any dealing of any cryptocurrency in India as no Indian will be able to buy / sell , make payment or receive payment In India .
However RBI has constituted a internal committee to study feasibility of introduction of its own digital currency . the committee is expected to give its report before June 2018 .
For Press release of RBI dated 05.04.2018 , CLICK HERE
Subsequently RBI has issued Notification on 06.04.2018 , CLICK HERE to read the notification .
Dated 05.04.2018 : Reserve Bank of India today prohibited all the entities like Banks , NBFCs , Payment Banks , wallets regulated by them to deal with or provide any service related to transactions involving Bitcoins and other cryptocurrencies . The ban comes in to effect with immediate effect . All the entities which are providing such facilities have to exit in time bound manner . RBI will issue a circular shortly .
The ban virtually ends any dealing of any cryptocurrency in India as no Indian will be able to buy / sell , make payment or receive payment In India .
However RBI has constituted a internal committee to study feasibility of introduction of its own digital currency . the committee is expected to give its report before June 2018 .
For Press release of RBI dated 05.04.2018 , CLICK HERE
Subsequently RBI has issued Notification on 06.04.2018 , CLICK HERE to read the notification .
HDFC BANK DISALLOWS ITS CARDS FOR PURCHASE OF BITCOINS
Dated 18.03.2018 : It is reported that HDFC Bank , India have informed their customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using HDFC Bank debit or credit cards . Already in February 2018 Citibank India had stopped allowing its cards for purchase of bitcoins and other cryptocurrencies . In the February 2018 itself , the country's central banker Reserve Bank of India had also warned bank customers in India against investing in Bitcoins and other cryptocurrencies .
Dated 18.03.2018 : It is reported that HDFC Bank , India have informed their customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using HDFC Bank debit or credit cards . Already in February 2018 Citibank India had stopped allowing its cards for purchase of bitcoins and other cryptocurrencies . In the February 2018 itself , the country's central banker Reserve Bank of India had also warned bank customers in India against investing in Bitcoins and other cryptocurrencies .
BTCXIndia and ethexIndia TO CLOSE OPERATIONS IN INDIA
Dated 02.03.2018 : Cryptocurrency Exchanges BTCXindia and ethexIndia are closing down its operations in India .
In its website , BTCXindia dealing in Ripples ( XRP ) has asked its customers not to make any Indian Rupee or Ripple ( XRP ) deposits with effect from 01.03.2018 . If any remittance is made , it would be automatically returned to the sender bank . Further it has asked all its customers to withdraw all the deposits both in Indian rupee as well as in Ripple ( XRP ) before 4th March , 2018 .
For further details , one may visit official site of BTCXIndia , by CLICKING HERE
Similarly Cryptocurrency Ethereum ( ETH ) Exchange ethexIndia is closing down its operations in India . In its website , it has asked its customers not to make any Indian Rupee or Ethereum ( ETH ) deposits with effect from 01.03.2018 . If any remittance is made , it would be automatically returned to the sender bank . Further it has asked all its customers to withdraw all the deposits both in Indian rupee as well as in Ethereum ( ETH )
For website of ethexIndia CLICK HERE
It is reported that the reason for closure of operations is the budget speech of Mr Arun Jaitley wherein he had advised the intention of government was to outlaw the cryptocurrencies . He had also announced the intention of government to bring suitable amendment to the existing laws to this effect .
Dated 02.03.2018 : Cryptocurrency Exchanges BTCXindia and ethexIndia are closing down its operations in India .
In its website , BTCXindia dealing in Ripples ( XRP ) has asked its customers not to make any Indian Rupee or Ripple ( XRP ) deposits with effect from 01.03.2018 . If any remittance is made , it would be automatically returned to the sender bank . Further it has asked all its customers to withdraw all the deposits both in Indian rupee as well as in Ripple ( XRP ) before 4th March , 2018 .
For further details , one may visit official site of BTCXIndia , by CLICKING HERE
Similarly Cryptocurrency Ethereum ( ETH ) Exchange ethexIndia is closing down its operations in India . In its website , it has asked its customers not to make any Indian Rupee or Ethereum ( ETH ) deposits with effect from 01.03.2018 . If any remittance is made , it would be automatically returned to the sender bank . Further it has asked all its customers to withdraw all the deposits both in Indian rupee as well as in Ethereum ( ETH )
For website of ethexIndia CLICK HERE
It is reported that the reason for closure of operations is the budget speech of Mr Arun Jaitley wherein he had advised the intention of government was to outlaw the cryptocurrencies . He had also announced the intention of government to bring suitable amendment to the existing laws to this effect .
SBI CARD CAUTIONS AGAINST USE OF BITCOINS
Dated 21.02.2018 : Today SBI Card , a division of State Bank of India , advised its customers about the potential economic , operational , financial , legal , customer protection and security related risks associated with use of Bitcoins . However , unlike Citibank , it has not prohibited use of SBI cards for transactions involving cryptocurrencies . But Citibank earlier had informed their customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using Citibank debit or credit cards . Already Reserve Bank of India has warned bank customers in India against investing in Bitcoins and other
Dated 21.02.2018 : Today SBI Card , a division of State Bank of India , advised its customers about the potential economic , operational , financial , legal , customer protection and security related risks associated with use of Bitcoins . However , unlike Citibank , it has not prohibited use of SBI cards for transactions involving cryptocurrencies . But Citibank earlier had informed their customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using Citibank debit or credit cards . Already Reserve Bank of India has warned bank customers in India against investing in Bitcoins and other
CITIBANK INDIA DISALLOWS ITS CARDS FOR PURCHASE OF BITCOINS
Dated 13.02.2018 : Today Citibank , India informed its customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using Citibank debit or credit cards . Citibank has decided not to permit usage of its debit or credit cards for purchase of Bitcoins and other cryptocurrencies , given concerns of potential economic , operational , legal , customer protection and security related risks associated with such transactions. Already Reserve Bank of India has warned bank customers in India against investing in Bitcoins and other cryptocurrencies .
Dated 13.02.2018 : Today Citibank , India informed its customers that they would be no longer able to do the transactions involving cryptocurrencies including Bitcoins using Citibank debit or credit cards . Citibank has decided not to permit usage of its debit or credit cards for purchase of Bitcoins and other cryptocurrencies , given concerns of potential economic , operational , legal , customer protection and security related risks associated with such transactions. Already Reserve Bank of India has warned bank customers in India against investing in Bitcoins and other cryptocurrencies .
INCOME TAX DEPARTMENT SENDS NOTICES TO BITCOIN INVESTORS :
Dated 12.02.2018 : It is reported that Income Tax department has sent more than 1,00,000 notices to the investors of Bitcoins and other cryptocurrencies in India to verify whether they have paid due income tax on the profits made out of Bitcoin transactions and reported the same in their Income tax returns . It is reported that Mr Sushil Chanda , chairman of Central Board of Direct Taxes disclosed the matter whilst speaking in an event organized in New Delhi by ASSOCHAM
Dated 12.02.2018 : It is reported that Income Tax department has sent more than 1,00,000 notices to the investors of Bitcoins and other cryptocurrencies in India to verify whether they have paid due income tax on the profits made out of Bitcoin transactions and reported the same in their Income tax returns . It is reported that Mr Sushil Chanda , chairman of Central Board of Direct Taxes disclosed the matter whilst speaking in an event organized in New Delhi by ASSOCHAM
WORLD BANK CHIEF CALLS BITCOINS A PONZI SCHEME
Dated 08.02.2018 : Newspapers reported that Mr Jim Yong Kim , World Bank Group president told in an event that cryptocurrencies like Bitcoins are ponzi schemes .However world bank is looking in to the blockchain technology which uses distributed ledgers to facilitate secured trading of digital assets . Earlier in the week Mr Agustin Carstens , chief of Bank of International Systems ( BIS ) had asked central banks to rein in cryptocurrencies as they can cause disturbances to the existing financial system .
In the mean time , Bitcoin is trading at around USD 8,000 after falling from life time high of around USD 19,300 in recent weeks .
Dated 08.02.2018 : Newspapers reported that Mr Jim Yong Kim , World Bank Group president told in an event that cryptocurrencies like Bitcoins are ponzi schemes .However world bank is looking in to the blockchain technology which uses distributed ledgers to facilitate secured trading of digital assets . Earlier in the week Mr Agustin Carstens , chief of Bank of International Systems ( BIS ) had asked central banks to rein in cryptocurrencies as they can cause disturbances to the existing financial system .
In the mean time , Bitcoin is trading at around USD 8,000 after falling from life time high of around USD 19,300 in recent weeks .
GOVERNMENT OF INDIA WARNS AGAINST INVESTING IN BITCOINS
Dated 30.12.2017 : Ministry of Finance , Government of India has issued warning people against usage of virtual currencies including Bitcoins , as they are neither currencies nor coins . The statement says virtual currencies are not legal tenders and are not authorized by either Government of India or Reserve Bank of India . The notification lists various risks associated with Bitcoins like volatility , hacking , loss of passwords etc. It compares the operation of Bitcoins to Ponzi schemes and advises the citizens to avoid Bitcoins as they would be participating in BITCOINS at their own risks .
However Ministry of Finance does not say that Bitcoins are illegal in India
Ministry of finance notification on its Facebook page . CLICK HERE
Dated 30.12.2017 : Ministry of Finance , Government of India has issued warning people against usage of virtual currencies including Bitcoins , as they are neither currencies nor coins . The statement says virtual currencies are not legal tenders and are not authorized by either Government of India or Reserve Bank of India . The notification lists various risks associated with Bitcoins like volatility , hacking , loss of passwords etc. It compares the operation of Bitcoins to Ponzi schemes and advises the citizens to avoid Bitcoins as they would be participating in BITCOINS at their own risks .
However Ministry of Finance does not say that Bitcoins are illegal in India
Ministry of finance notification on its Facebook page . CLICK HERE
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MORE THAN 2000 VIEWS IN ITS FIRST WEEK OF PUBLICATION
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AAYKAR SETHU , NEW MOBILE APPLICATION FOR ALL YOUR INCOME TAX JOBS
New Updated Article
TAX PLANNING FOR FY 2022-23 ( AY 2023-24 )
Comprehensive Article on Income tax changes in Rules, Rates , Slabs , Rebates and Estimation
CLICK HERE TO READ
RBI CAUTIONS ON BITCOIN USAGE
Reserve bank of India has warned as early as in December 2013 about the risks associated in use of virtual currency including Bitcoins . It has also repeated the message on December 5, 2017 . The major concerns expressed by RBI are
1. VCs are in digital forms and stored in digital wallets . They are prone to hacking , malware , loss of password etc . LOSS OF WALLET MEANS TOTAL LOSS OF ASSET .
2. Payments take place peer to peer basis without intervention of a central agency . No recourse may be available for disputes between the parties .
3. No asset back up for Bitcoin and market prices are speculative . Prices are volatile and volatility may lead to huge losses .
4. Legal status of exchange platforms are not clear and users are exposed to legal and financial risks .
5 . Usage of Bitcoins from the counter party may be for illegal / illicit purpose . Hence usage may unintentionally lead to breach of Anti-money laundering provisions .
For RBI Press release dated 24.12.2013 , CLICK HERE
1. VCs are in digital forms and stored in digital wallets . They are prone to hacking , malware , loss of password etc . LOSS OF WALLET MEANS TOTAL LOSS OF ASSET .
2. Payments take place peer to peer basis without intervention of a central agency . No recourse may be available for disputes between the parties .
3. No asset back up for Bitcoin and market prices are speculative . Prices are volatile and volatility may lead to huge losses .
4. Legal status of exchange platforms are not clear and users are exposed to legal and financial risks .
5 . Usage of Bitcoins from the counter party may be for illegal / illicit purpose . Hence usage may unintentionally lead to breach of Anti-money laundering provisions .
For RBI Press release dated 24.12.2013 , CLICK HERE
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