Bitcoin is hailed as one of the foremost options for investment of late. Given the growing uncertainty and everyday speculation in the digital currencies, investors need to be wary of certain things.
The regulators have constantly expressed concerns over the trade of crypto currencies including Bitcoin. However, it still remains bullish, to attract many more. Here’s what the authorities have said on the Bitcoin regulations in India.
The Reserve Bank of India (RBI) has cautioned the users, holders and traders of virtual currencies (VCs), time and again. The RBI has said that Bitcoin or other VCs are not a medium for payment, nor it is authorised by any central bank or monetary authority. The India’s central banking institution has also stated risks of trading in Bitcoins: prone to losses arising out of hacking, no redressal of grievances, the value is a matter of speculation and trading may subject the user to illicit and illegal activities.
In November, India’s Supreme Court – the highest court in the country – had sought the Finance, Law and Justice and Information Technology ministries, as well as the central bank RBI and market regulator Securities and Exchange Board of India, to provide clarity on Bitcoin regulations in the country.
In March, the finance ministry formed an inter-disciplinary committee led by Special Secretary in Department of Economic Affairs to look at the status of VCs and was asked to come up with measures for Bitcoin regulations. The committee included representatives of RBI, State Bank of India (SBI), NITI Aayog and Department of Financial Services. In August, the committee submitted its report to the finance minister Arun Jaitley. In November, the finance minister Arun Jaitley said, that the government’s stance is clear, it don’t recognise any VCs as legal currency as of now.
The chairman of Securities and Exchange Board of India (SEBI) has confirmed that SEBI along with the Ministry of Finance, Ministry of Electronics and Information Technology and RBI are looking at the legal oversight for crypto currencies such as Bitcoin.
Recently, Income Tax (I-T) department has made a bid to tax the gains made by Bitcoin traders and investors, having conducted surveys of crypto currency exchanges in Delhi, Mumbai, Bengaluru, Pune and Hyderabad.