At present, Bitcoin is one of the most coveted cryptocurrencies across the globe. However, as the industry evolves, India is still developing and slowly catching up. Therefore, cryptocurrency-seeking individuals should educate themselves on this asset class before investing.
Here is what you should know about buying bitcoins.
How to Buy Bitcoin in India Legally?
How to invest in Bitcoin in India is often an ambiguous question for new investors. However, individuals planning to purchase Bitcoins can take the following course of action to invest without breaking any law:
First, investors should submit essential documents, including the Aadhaar Card and PAN card. After that, they should complete the KYC process thoroughly.
ITobuy Bitcoins, an individual must place an order for their purchase on a cryptocurrency exchange.
Once an order is placed, investors can transfer the payable amount from their bank accounts to the crypto exchange. Alternative modes of payment include RTGS, NEFT, debit or credit cards, and other digital payment methods used for routine transactions.
The next step for investors is to securely store their purchased Bitcoins in cryptocurrency wallets provided by the cryptocurrency exchange.
A point to note he that any transaction here has an entry in a public ledger and transacted Bitcoins are registered with their wallet IDs instead of the names of sellers or owners.
Where to buy it?
As for these cryptocurrency exchanges, one can turn to digital platforms like Coindesk, ZebPay, or Coinbase.
These digital exchanges allow investors to purchase Bitcoins at the current market price. In addition, one can use international credit cards to buy Bitcoins on these digital exchanges.
Some cryptocurrency exchanges offer a downloadable mobile application which is compatible with Android as well as iOS. Therefore, potential investors can easily link their bank accounts to their smartphones and use this linkage for instant transactions and transfers.
Remember that one must undergo a basic KYC process before trading in Bitcoins. So, investors cannot buy Bitcoin in India without a PAN card. In addition, investors’ PAN cards must be connected to their bank accounts used foto withdraw and transfer funds from a cryptocurrency exchange.
Besides, one should also learn about the minimum investment required for Bitcoins before initiating any transactions.
What Is the Minimum Amount of Investment in Bitcoins?
Just like there is no minimum limit for investing in stocks, there is no defined minimum amount to buy Bitcoin in India. That said, there is a difference – an investor can purchase small units if they do not wish to buy an entire cryptocurrency.
When registered, individuals can add money into their wallets and use this sum to order bitcoins. In India, an investor can buy Bitcoin in Indian Rupees with a minimum capital of Rs.100. This limit could vary between various crypto exchanges.
Nonetheless, trading Bitcoins is one side of the story; storing them securely after purchase is also imperative.
How to Store Bitcoin?
A blockchain wallet is used to store Bitcoins. Alongside storing currency, a crypto wallet stores keys for enabling transactions, encrypting, and signing information, all of which ensure the safety of funds.
There are two types of wallets –
Cold Wallets: These crypto wallets store users' private keys offline. They work in conjunction with compatible software on one’s computer. Furthermore, as they do not store information digitally, cold wallets extend a higher level of security.
Hot Wallets: Hot wallets work with internet connectivity. They allow users to send and receive internet tokens, facilitating basic transactions. In addition, based on their software usage, hot wallets are of these types:
Desktop Wallets
Web Wallets
Mobile Wallets
Points to Remember When Buying Bitcoins in India
Here are a few points to consider when learning how to purchase Bitcoin in India-
A potential investor should first gain an insight into the overall scenario of the global and Indian crypto capital markets. Then, they can do comprehensive research via ample online material on different websites.
It is also wise to track the movement of prices of digital coins and the share of Bitcoin in the market. Investors can do so via different online platforms dedicated to this purpose. Also, they can refer to different exchange platforms for daily updates.
Your Take
While Bitcoins are known to have extremely high returns in a short period, this is a relatively new instrument in the Indian market. As a result, these are highly volatile as well. Further, RBI has not made it legal, so there is always a risk of losing your capital.
Therefore, investors consider all the downsides to this investment before investing.
Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.