Information You Need to Know About Cryptocurrency
Cryptocurrency is a form of digital payment that can circulate around without the interruption of any centralized body such as a government or RBI (Reserve Bank of India). However cryptocurrencies designed in a way to promote the use of cryptographic techniques that grant people to buy, sell, or trade them safely.
Cryptocurrencies can be exchanged for goods and services also they can be used as an investment. It also plays a key part in the operation of some decentralized financial networks, where there is a need of digital tokens for carrying out transactions. Cryptocurrencies are widely used for investment purpose, ad many people consider it a digital asset.
No one knows for sure who invented Cryptocurreny but in 2009, a Pseudonymous developer named Satoshi Nakamoto was credited with introducing the first decentralized Cryptocurrency “Bitcoin”. Bitcoins are created as a reward for carrying out a process, known as Mining.
Cryptocurrency: Cashable currency or digital asset?
Cryptocurrency is a tradable digital asset or digital form of money which is built on Blockchain technology that only exists online. These cryptocurrencies use encryption to authenticate and protect transactions.
A cryptocurrency is a type of virtual or digital currency that can work as a medium of particular exchanges such as values or transactions. Cryptographic technologies are being used in a form of digital currency to secure, process, and verify transactions.
Cryptocurrency has become a rage and people have started investing in it, considering it a digital asset. More and more people are curious to know about how they can invest in cryptocurrencies. Many business tycoons are looking forward to invest their money in cryptocurrency, keeping in mind the predicted growth of digital assets.
There are many applications in the market on which you can register your account and start investing. Cryptocurrencies like Bitcoin, Ethereum, Ripple, along with other cryptocurrencies are becoming widely popular. To invest in these cryptocurrencies all you need is an online wallet to buy, sell, or trade in crypto. You can create an account on an exchange, and then you can transfer real money to buy cryptocurrencies such as Bitcoin or Ethereum.
Is It Safe To Invest In Cryptocurrency?
According to our research, yes it is safe to invest in cryptocurrencies but only if you safely invest in it. However, there are no positive or accurate signs that can make a clear statement to answer this question. It is still a growing asset class but has not yet gained world acceptance like other equities, mutual fund, and commodities. Cryptocurrency is a good start for investment purpose if you want to gain exact exposure to the demand for digital currency, but you could also risk losing your money if you are not investing safely. The safety aspects of cryptocurrencies are dubious and needs to be worked on, as we can sense that cryptocurrency is here to stay. In the view of rapid customer base growth, cryptocurrency exchanges show optimism and positive growth indicating that this emerging asset class will keep attracting more investors in India.
Even with the emerging popularity of crypto coins in the Indian market, many investors hesitate to spend their money in the digital coin trading platforms. The emerging trend shows that younger Indian investors are investing their money in cryptocurrencies in the form of crypto assets instead of traditional options. Many investors still remain hesitant, but they are keen on exploring this cryptocurrency world.
Is Cryptocurrency legal in India?
The journey of Cryptocurrency from completely banning crypto in 2016 to an upcoming bill for regulation- the government’s position on digital assets has changed significantly over the past few years. However, the upcoming cryptocurrency and regulation of official digital currency bill, 2021 is completely different from the earlier one – ‘Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019.’
On Tuesday, February 1, 2022 in India, Cryptocurrency taxation is finally introduced. According to Finance Minister Nirmala Sitharaman, the scale and speed of these transactions necessitate the establishment of a special tax regime, by considering the remarkable growth in the transaction of virtual digital assets. The government has taken a stable step towards crypto taxation and digital assets by releasing 30% of such income. Finance Minister Nirmala Sitharaman introduced her budget 2022 and said that 30% tax will be charged on the income transferring of any virtual and digital assets. She also stated that no allowance will be permitted in the event of any losses. Gifts of virtual digital assets will also be taxed in the recipient's hands.
A central bank is no longer required because cryptocurrency (Bitoin) can be created by anyone to run the same chain. The transfer system of peer-to-peer between two people on Bitcoin’s network evades intermediaries’ involvement in managing and distributing currency. Many banks around the world are refusing their involvement in Bitcoin and other cryptocurrencies transaction. Due to lack of clear signs, to regulate Bitcoin as conventional money, some banks prohibited the uses of crypto in their accounts.
Despite all the rumors that claims cryptocurrency is a threat to banks, many banks or Bitcoin-friendly banks are continuously growing by allowing people to do transactions in Bitcoin as a payment method. Apart from this, those banks who accepted Bitcoin transactions are increasing slowly. The 69.2 percent growth of American credit card market is showing the data of those banks who declared Bitcoin a "No-Go".
What Government says about Cryptocurrency?
Government says that cryptocurrencies are widely being misused for money laundering and tax evasion purpose. Some people are investing their money in cryptocurrency only to get rid of tax. As discussed, circulate around without the interruption of any centralized body such as a government or RBI (Reserve Bank of India). Government does not want to lose control over these cryptocurrencies as there is no one who can control it.
Along with money laundering or tax evasion, there are many other reasons why government desires authority over the regulation of cryptocurrency. One of the main reasons is security breach or Ransomware attacks over these digital coins.
