Bitcoin in India

Will Bitcoin Ever Be Accepted As A Legal Tender in India?

Nowadays, a lot of stories can be found happening across cryptocurrency and bitcoin.

Now, more and more people becoming aware of bitcoins and also looking forward to invest in.

But, we all know that Bitcoin is not a legal tender in India, and the question is will it ever be? Let’s find out…

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Latest Development On The Legal Status of Bitcoin

India’s Union Budget 2018-19 was announced by the country’s Finance Minister, Arun Jaitley. This was about taking all the measures for eliminating cryptocurrencies in illegitimate activities.

Mr. Arun Jaitley said in a statement –

“The Indian government will take all measures to eliminate the use of crypto-assets in financing illegitimate activities. The government will also explore the use of blockchain technology for ushering in the digital economy.”

The co-founder and CEO of ThroughBit, Abhishek G, remarked –

“It’s heartening to hear the Finance Minister talking about the governments impending involvement in eliminating fraud and fraudulent use of crypto-assets. The general public should breathe a sigh of relief knowing that the government will now take steps to safeguard them, and that we are now closer than ever to a regulated crypto-asset market.”

He further added –

“Also, the use of Blockchain technology for establishing a full fledged digital economy should excite entrepreneurs. It will lead to the development of a slew of industry defining products and services.”

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Income Tax Issued Notices To 100K Cryptocurrency Traders

During the Bitcoin bubble burst, probably the since Tulipmania, in contrast to the reports saying that 400-500 HNIs had issued notices over Bitcoin trading, Sushil Chandrahas, the Chairman of CBDT, clarified that about 100K HNIs who had invested in Bitcoin without declaring about it in ITR were issued notices by Income Tax Department.

While speaking at the ASSOCHAM event, the CBDT Chairman said –

“People who have made investments (in cryptocurrency) and have not declared income while filing taxes and have not paid tax on the profit earned by investing, we are sending them notices as we feel that it is all taxable.”

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What If Bitcoin Is Legalized In India?

According to CNBC, a committee of finance ministry officials, IT ministry officials, Reserve Bank officials and NITI Aayog may be inching closer to legalizing Bitcoin in India.

From the exercising caution over Bitcoin, the Indian Government could be moving towards compliance.

If Bitcoin is legalized in India, the following would happen –

  • Bitcoins would come under the cognizance of RBI’s 1930 Act.
  • The investors would be forced to pay taxes.
  • RBI would issue guidelines in regards to investment and purchases of Bitcoin.
  • All the foreign payments would fall under the cognizance of FEMA Act.
  • Returns from investment in Bitcoins would be taxed.

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Conclusion!

With the above stated facts, it can be stated that the government has not plans to make a legal tender for bitcoin. And if that happens, then there would be certain rules and regulations which won’t work for the reasons bitcoin was invented.

But we cannot predict the future. What will happen to the legalization of buying Bitcoin in India, you never know!

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