Topic: FAQs Regarding Bitcoin's Status in India | Newbie's guide - page 2. (Read 344 times)

https://e-resident.gov.ee/

https://en.wikipedia.org/wiki/E-Residency_of_Estonia

Sorry, I don't get it.

Apart from mention of Crypto in remarks, bank can also get customer data from exchanges directly or indirectly (through agencies). This is why it is better to avoid centralized KYC exchanges for FIAT to Crypto conversion or vice versa. Exchanges like HodlHodl.com, LocalEthereum.com and local.Bitcoin.com enables one to trade without providing KYC to a centralized repository.


Creating an Estonian identity and operating under that identity would be the most legal option IMHO.

Its simple and good for any one who is new to cryptos and seeking these answers.

But I have a question to ask to community,let's assume bitcoin was made illegal overnight then what could be the best way to cashout bitcoins?

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Can we use localbitcoin via western union or money transfer from another country traders?

I have come across a lot of people who are pretty much confused regarding the legal status of Cryptocurrencies in India. Most of this confusion came after the RBI restricting banks from dealing in cryptocurrencies. Followed by certain websites claiming that Bitcoin ban Bill is arriving soon. But I would like to clear all those questions in the most concise manner possible.

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Ques 1: Is Bitcoin Banned in India?
Ans 1: No Bitcoin is not Banned in India. Banned as per literal meaning means prohibited from use. So it's not prohibited from use.

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Ques 2: Is Bitcoin Legal in India?
Ans 2: Yes, it's legal but basically due to absence of any Law. For Example, Until the enforcement of Information Technologies Act, 2000 even hacking could have been considered Legal as there were no laws guiding it.

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Ques 3: If bitcoin is not banned then why RBI banned it or what did RBI do?
Ans 3: RBI is financial Regulator of the Country. Bitcoin maybe considered as a financial asset but it's actually a technology beneath. So it's circulation and usage would fall under purview of Government and not RBI. RBI merely asked the Banks to completely stay away from Crypto Dealings. This means RBI enforced the Banks and not the people to:
1. Stay away from Exchanges dealing in Cryptocurrency.
2. Avoid Transactions which are in relation with flow of Cryptocurrency.
3. Not provide any services relating to Cryptocurrencies.

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Ques 4: This means I can purchase and sell bitcoins through banks and Won't be jailed or penalized
Ans 4: Yes, no one can touch you for merely dealing in cryptocurrencies until there comes a law governing it. Now, this doesn't mean you can take contract of murder in payment of cryptocurrencies because you still be charged for murder. I mean using cryptocurrencies for legal purposes.

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Ques 5: If RBI hasn't ban cryptocurrencies why was my Bank Account freezed when I used it for crypto transaction
Ans 5: It's because banks are liable to avoid any such transactions and if you do such transactions banks would try to stop them. But you are pretty good to go until you not mention Crypto anywhere in Remarks. Even if you mention there are pretty less chances that someone is going to notice any such thing. Moreover, I have seen just like 5 out of 100 people facing such an issue so try changing to some private bank.

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Ques 6: Does this means if I my cryptocurrency are stolen Police won't do anything?
Ans 6: The truth is that Police has the responsibility to find out anything stolen from you which is valuable to you and valuable in General. But considering the practical image of Police, you might have a really hard time complaining and finding out any stolen cryptocurrency so obviously TRADE with CARE.

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Ques 7: If cryptocurrency doesn't has any law does this means I don't have to pay tax on it?
Ans 7: The objective answer to this is that you Still have to pay taxes on any earned income in cryptocurrency. Because the mode or medium of earning such income is not of any importance to Income tax. Even the incomes not received yet are taxed pretty much normally. So you won't be able to evade taxes with it. But to save taxes, it is a pretty large discussion for a separate thread.

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Ques 8: Is Indian government deciding to Ban Bitcoin and cryptocurrencies?
Ans 8: This is a mere speculation going on since three years. A few ministers have given some indications that they might do so. But no one still knows if this is going to happen. There are no details of this Act made Public. Everything going around the web that it has banned or 90 days will be given to clear of everything is a hoax as of now.

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Ques 9: What if I am still holding cryptocurrencies and government bans Bitcoin will I lose Everything?
Ans 9: I personally feel that Government would give some time to people to get out of the mess. Still as there is nothing public on it may ban it immediately. No one knows how things would go so obviously TRADE with CARE.


I think I have pretty much answered all the basic questions. But if someone still has any other question I would add them by editing this thread itself and answer them.