Cryptocurrency is the latest trend in the market, and according to Economic Times, 6 lakh crores are invested in the crypto assets by Indians. Shocking right! Yes, Indians, especially the millennial generation, are investing hugely in cryptocurrency after seeing the raise of these coins in the market. The potential of these coins has made them one of the most preferred investment options for people.
Now, you may have lots of doubts about how to invest in cryptocurrency in India. Is it legal to invest? This article is here to answer all the doubts that you have in mind. Make sure to stick till the end.
What is Cryptocurrency? Is it Legal in India?
So, before we dig into more details, let’s get our basics covered first. The most important thing is to know about what cryptocurrency is.
The first cryptocurrency came into existence in 2009, and it is named BitCoin- the highest priced cryptocurrency in the market right now. Following it, there are so many other coins that are now available in the market.
The thing about these crypto assets is that they don’t have a physical presence. When you invest in an asset such as gold or land, you can see and touch it by yourself, but that is not the case with cryptocurrency.
These coins will only have an address that is shared with you. They are generated using advanced technology and the mining process. The mining of these coins requires huge electricity and advanced computer equipment. This mining process cannot be done in India because of the infrastructure cost and high electricity prices.
They are mined from China or Norway and are distributed everywhere in the world. As they don’t have a physical presence, buying and selling them is easy with the right exchange platform.
So, the next question that you will get in mind is that it is even legal in India. The answer is “not sure.” There is no particular regulation or legislation related to cryptocurrency, and this doesn’t make it illegal. However, the transactions are not as safe when compared to usual fiat currency transactions.
This means, usually when there is an issue with the bank transactions, customers can contact the bank in the stipulated time frame and get it sorted. Banks are responsible for ensuring that you get a resolution. If you don’t, there is always a banking ombudsman whom you can contact. But in the case of cryptocurrency, it is not going to happen.
If there is an issue with a transaction, you have to get in touch with the exchange and get it sorted with the help of them only. There is no regulation that will help in sorting the issue for you. Opting for a reliable exchange platform and wallet that will keep your money safe is the only option that is left for you.
Choosing the Right Platform
Now it is time for you to pick the right exchange platform. There are so many official platforms where you can trade and store cryptocurrency. There are two things here that you need to remember- Exchange and Wallet.
Exchange is where you will be buying cryptocurrency, and a wallet is a place where you will be storing it. Most of the exchange platforms offer a storage facility for their users, making it a safer option. However, there are some exchanges where you just have to buy the coins and store them in your wallet.
The reason why you shouldn’t keep your coins in an exchange account is that they can get stolen from there, or anyone can misuse them without you knowing. Hence, storing them in the wallet will ensure your security and safety at the same time.
There are some things that you need to verify before choosing the right exchange platform.
Supports Wide Range of Cryptocurrencies
There are so many crypto coins that most of us don’t know about. Bitcoin, Ethereum, Ripple are almost available on all the exchanges, but there are some that are not available on all the exchanges. So, go with such an exchange which has almost all types of cryptocurrencies available, and you can buy them with INR itself without converting it to USD and then purchase.
Ease of Use
This is another important thing. Depositing and withdrawing of the money, buying and selling of the coins are constant happenings on an exchange. Hence, it is important for you to go with the platforms that have a better user interface and make it easy for you to operate it.
Depositing and withdrawing the amount is quite easy on some apps, and you will get your amount back into your account within some time when you withdraw it. Try to go with such kinds of apps only.
Be it small or big, you will be investing your hard-earned money, and it is important for you to ensure that your amount is safe and secured. If the exchange isn’t secure, there is a high chance for your assets to get stolen.
Select a crypto exchange that provides encrypted transactions and keeps your assets in locations that aren’t connected with the internet. This will provide you with safety and security.
Every platform will charge this, and these charges are independent for each platform. There is no rule for how much they charge. However, the maximum percentage that a platform can charge is 1% and if you see any platform charging more than that, then stay away from it.
If you are trading in bulk, your platform is supposed to charge you less exchange fee. Some platforms also charge withdrawal fees as well. Go with an app that charges you a minimal and reasonable amount for the transactions.
Once you check all these things and find a good, reliable exchange partner for your crypto coins, you are good to go. There are some good exchange platforms available in India, and I am listing a few for you. Make sure to conduct thorough research and then pick one and get started with the crypto trading immediately.
Investing in crypto isn’t a tough task anymore. There are ample exchanges and enough knowledge on it for people to get started with their trading. One thing that is quite important is for you to do enough research on the coins that you are going to invest in.
A full guide explaining the factors to look at in crypto coins before you invest comes very soon. Make sure to read and follow it through to minimize the risk factor.