Bitcoin is a decentralised digital currency that can be bought, sold, and exchanged without using an intermediary such as a bank. It is a mode of exchange, a currency, and a store of value or an alternative investment. Bitcoin is widely regarded as the first crypto and has gained immense popularity worldwide. However, it has also experienced significant price fluctuations, creating a captivating narrative of ups and downs.
In India, Bitcoin is not considered legal tender, but it is not illegal to hold or transact in Bitcoins. Investors can purchase Bitcoin in India through various online exchanges such as CoinDCX, CoinSwitch, Mudrex, WazirX, and Binance. These exchanges allow investors to purchase Bitcoin at the current market price, and some also offer mobile applications for easy access.
Before investing in Bitcoin in India, individuals must complete a Know Your Customer (KYC) verification process and submit essential documents, including the Aadhaar Card and PAN card. It is important to note that Bitcoin is a highly volatile investment, and experts recommend allocating only a small percentage of your portfolio to it.
Characteristics | Values |
---|---|
Current Price of Bitcoin | $59,441 as of August 29, 2024 |
Market Capitalization | $1.17 trillion as of August 29, 2024 |
24-hour Trading Volume | -11.60% as of August 29, 2024 |
Cryptocurrency Exchanges in India | CoinDCX, CoinSwitch, Mudrex, WazirX, ZebPay, Unocoin, Binance, Coinbase, Coindesk |
Payment Options | Bank transfers, net banking, Mobikwik, cryptocurrency wallet, UPI, debit/credit cards, NEFT, RTGS |
Minimum Investment | No minimum amount, can start with INR 100 |
Storage Options | Cold Wallets, Hot Wallets |
What You'll Learn
How to buy Bitcoin in India legally
Bitcoin is the world's first and most prominent cryptocurrency. It was originally designed as a payment system but quickly became an attractive investment opportunity. In India, millions of investors have embraced Bitcoin, adding it to their portfolios as a hedge against inflation.
Step 1: Register and Verify Your Account on a Crypto Exchange:
Choose a reputable cryptocurrency exchange that operates in India, such as Mudrex, CoinDCX, WazirX, ZebPay, Coindesk, or Coinbase. Create an account by providing your personal details and undergo KYC (Know Your Customer) verification to comply with regulatory requirements.
Step 2: Add Funds to Your Wallet:
Before buying Bitcoin, you must deposit funds into your exchange wallet. Most crypto exchanges support NEFT, IMPS, and net banking payment methods. Mudrex allows you to invest in Bitcoin and over 350 other cryptocurrencies using UPI. You can also use international credit cards to buy Bitcoins on some exchanges.
Step 3: Place Your Bitcoin Order:
Now you're ready to buy Bitcoin. Go to the Bitcoin page on your chosen exchange, click 'Buy', and choose from a lump sum or recurring investment. Then, complete the payment.
Step 4: Select a Secure Storage Option:
Once you've bought Bitcoin, it's crucial to store it securely. Most exchanges offer custodial wallets, but consider transferring your Bitcoin to a non-custodial wallet for enhanced security. Non-custodial wallets grant you full control over your funds and have a minimal risk of being hacked because no personal information is stored. They are available in both hardware and software options.
Important Considerations:
- Security Measures: Look for platforms with robust security measures like two-factor authentication (2FA), cold storage, fund insurance, and data encryption.
- User Interface (UI) and Experience: Choose an exchange with a simple, intuitive UI.
- Fees and Charges: Familiarize yourself with the fee structure, including trading fees, deposit and withdrawal fees, and any other charges.
- FIU Compliance: Ensure the platform adheres to regulations specified by the Financial Intelligence Unit (FIU), including Anti-Money Laundering (AML) and Know Your Customer (KYC) procedures.
- Customer Support: Opt for platforms with strong customer support to help you when needed.
By following the steps outlined above, investors can navigate the cryptocurrency market with confidence. Remember to only invest what you can afford to lose and do your research before investing.
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Where to buy Bitcoin in India
To buy Bitcoin in India, you can use a cryptocurrency exchange platform. It is important to ensure that the platform is registered with the Financial Intelligence Unit India. Some factors to consider when choosing an exchange include user-friendliness, the range of cryptocurrencies offered, trading fees, and liquidity.
CoinDCX
CoinDCX is one of the safest and most transparent crypto exchanges in India, with over 1.5 crore registered users. It offers access to up to 500+ cryptocurrencies and is known for its high liquidity. CoinDCX does not charge a fee for UPI and bank transfers, but it charges 0.5% for net banking.
CoinSwitch
CoinSwitch is one of the top cryptocurrency platforms in India, with over 2 crore registered users. It offers trading options in nearly 100 cryptocurrencies and is highly recommended for beginners. CoinSwitch allows investments to start from as low as INR 100 in Bitcoin.
Mudrex
Mudrex is an Indian government-recognised platform with over 0.2 crore users. It offers investment opportunities in over 600+ cryptocurrencies and has zero crypto deposit fees.
WazirX
WazirX is considered one of India's most reliable and rapidly growing platforms for cryptocurrency trading, with over 1.5 crore users. It offers access to over 300 cryptocurrencies for investment purposes. The trading fee on WazirX depends on your trading volume and WRX holdings.
Binance
Binance is a centralised exchange where you can buy several cryptocurrencies, including Bitcoin. To use the platform, you need to open an account and verify your identification. Binance offers a range of payment options, including debit/credit cards and Google Pay/Apple Pay.
ZebPay
ZebPay is another popular cryptocurrency exchange in India, allowing users to purchase Bitcoin at the current market price.
Coinbase
Coinbase is a digital platform that allows investors to purchase Bitcoin using international credit cards. It also offers a downloadable mobile application compatible with Android and iOS devices.
It is important to note that before trading in Bitcoins, individuals must undergo a basic Know Your Customer (KYC) process and provide essential documents, including the Aadhaar Card and PAN card.
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What is the minimum amount of investment in Bitcoins?
There is no minimum amount that has to be invested in Bitcoin in India. Investors can buy small units of Bitcoin if they cannot buy the entire cryptocurrency. The minimum investment amount can be as low as Rs.100 or INR 100. This limit can vary from exchange to exchange. For example, CoinSwitch allows investments to start from as low as INR 100 in Bitcoin.
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How to store Bitcoin in India?
Storing Bitcoin securely is a crucial aspect of investing in the cryptocurrency. In India, there are several options for storing Bitcoin, each with its own advantages and disadvantages. Here are some detailed instructions on how to store Bitcoin in India:
Using a Crypto Exchange Wallet:
When you buy Bitcoin on a crypto exchange like WazirX, CoinDCX, or ZebPay, they usually provide an integrated cryptocurrency wallet to store your Bitcoin. This is a convenient option as you can buy, sell, and store your Bitcoin all on one platform. However, some people prefer not to leave their crypto connected to the internet due to security concerns. While crypto exchanges store most customer assets in cold storage (offline), you may want to consider an additional storage option for extra security.
Using a Blockchain Wallet:
A blockchain wallet, also known as a crypto wallet, is specifically designed to store cryptocurrencies like Bitcoin. These wallets can be used to store your private keys, sign information, enable transactions, and encrypt data. There are two main types of blockchain wallets:
Cold Wallets:
Cold wallets store your private keys offline and work in conjunction with compatible software on your computer. Since they don't store information digitally, they offer a higher level of security. Cold wallets are ideal if you want to store large amounts of Bitcoin for a long time and don't need frequent access to them.
Hot Wallets:
Hot wallets, on the other hand, require an internet connection to function. They allow you to send and receive Bitcoin easily, making them suitable for more frequent transactions. However, they are generally considered less secure than cold wallets because they are always connected to the internet.
Other Options:
You can also store your Bitcoin in a personal crypto wallet outside of an exchange or use a third-party crypto wallet custodian. However, if you use a third-party custodian, you must be extremely careful not to lose your private key, as this could result in permanent loss of access to your Bitcoin.
Additionally, some platforms like Binance allow you to hold your Bitcoin in your account without needing to withdraw it to a separate wallet. This can be convenient if you plan to trade your Bitcoin for other cryptocurrencies or stake it for passive income.
Remember, it's crucial to research and understand the security features and risks associated with each storage option before deciding how to store your Bitcoin in India.
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What to consider before buying Bitcoins?
Investing in Bitcoin can be tempting, especially when its price is skyrocketing. However, it is a very volatile purchase, and one should be cautious before investing. Here are some things to consider before buying Bitcoins in India:
Educate Yourself
Before investing in Bitcoin, it is essential to understand the asset class. Gain insight into the global and Indian crypto capital markets and conduct comprehensive research using the ample online material available on different websites.
Track Digital Coin Prices and Bitcoin's Market Share
Investors can track the movement of prices of digital coins and Bitcoin's share in the market through different online platforms and exchange platforms for daily updates. This will help you make informed decisions about when to buy or sell.
Understand the Risks
Bitcoin is a relatively new instrument in the Indian market, and it is highly volatile. The RBI has not made it legal, so there is always a risk of losing your capital. Consider all the downsides to this investment before committing any money.
Choose a Reputable Crypto Exchange
It is important to select a crypto exchange that is registered with the Financial Intelligence Unit India. Look for an exchange with a user-friendly interface, extensive support for BTC trading pairs, and considerate trading fees. Some popular options in India include CoinDCX, ZebPay, Mudrex, and WazirX.
Payment Options
Different crypto exchanges may offer different payment options, such as bank transfers, net banking, Mobikwik, cryptocurrency wallets, or UPI. Compare the transaction fees associated with each payment option and choose the one that makes the most sense for you.
Safe Storage
Consider how you will store your Bitcoin once you have made a purchase. Crypto exchanges typically offer integrated Bitcoin wallets or preferred partners where you can hold your Bitcoin. However, some people prefer to store their Bitcoin in an offline wallet for added security. Keep in mind that if you move your crypto off of an exchange, you may have to pay a small withdrawal fee.
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Frequently asked questions
Yes, it is legal to buy Bitcoin in India. The Supreme Court of India lifted the RBI's restrictions on cryptocurrencies in 2020.
There is no minimum amount that has to be invested in Bitcoin. You can buy small units of Bitcoin if you don't want to buy a whole Bitcoin. The minimum investment amount can be as low as Rs.100.
You can store your Bitcoin in a blockchain wallet, also known as a crypto wallet. There are two types of crypto wallets: cold wallets and hot wallets. Cold wallets store your private keys offline and offer a higher level of security, while hot wallets work with internet connectivity and allow you to send and receive tokens easily.
The legal status of Bitcoin in India is still uncertain. While it is not illegal to hold or transact in Bitcoins, the RBI restricted commercial banks from facilitating Bitcoin transactions in 2018. However, this order was revoked by the apex court in 2020.
You can buy Bitcoin in India through various online Bitcoin exchanges, such as CoinDCX, ZebPay, WazirX, or Coinbase. You will need to complete a KYC process and provide important documents such as an Aadhaar card and PAN card. After that, you can place an order for Bitcoin and transfer the amount from your bank account to the crypto exchange.