What is cryptocurrency?
A cryptocurrency is a form of digital currency that is transferred directly from peer-to-peer, without the control of any centralized authority. It uses the cryptographic function of computers to facilitate financial transactions in a secure way. By leveraging blockchain technology, it creates a decentralized network of nodes across the globe hence adding transparency, efficiency and immutability to the economic ecosystem. The use of public and private keys enable a direct exchange of funds between the buyer and seller, negating the need for any third party to mediate the transaction. The trust is, hence, in the network. Some of the most notable virtual currencies today are Bitcoin, Ethereum, Litecoin, Ripple and Bitcoin Cash.
A global perspective on cryptocurrencies
Different countries have adopted different approaches to cryptocurrency. While countries like China, Bolivia, Cambodia and Ecuador have completely banned it, global sentiments towards cryptocurrency are evolving. Both the United States and Canada have allowed the use of cryptocurrency for trading of goods and for trading on exchanges, but they don’t consider it as legal tender. While the UK is still under EU regulations post-Brexit, it does not have any cryptocurrency laws in place, and the exchanges have registration requirements. The EU considers cryptocurrency legal across the bloc, but member states have enacted their own laws. Switzerland, Luxembourg, Belarus have taken the most progressive approach and are focusing on the benefits of this revolutionary technology. In fact, by promoting the use of crypto payments, Switzerland aims to become ‘the crypto nation’ of the world. Australia and Japan, too, provide friendly environments for cryptocurrencies, with Japan being the world’s biggest market for Bitcoin. As of January 2020, Singapore has opened up its crypto markets to global cryptocurrency companies. While cryptocurrencies have grappled with issues of user and government confidence across the globe in the initial years since their inception in 2009, it is now safe to say that there is an increasing interest and confidence in cryptocurrency, especially BTC, markets.
India lifts the banking ban on crypto trading
The crypto ecosystem in India has seen a tough two years since 2018- when the RBI banned banks from providing services for the trading of all virtual currencies. The inability to use Indian banks for their operations led to a near wipe-out of all crypto companies and startups. But a recent verdict by the apex court that overrules the central bank has given the sector much-needed respite. In a ruling passed in March 2020, the Supreme Court has lifted the ban, and further plans to regulate cryptocurrencies are underway. And this a fabulous time for investors, like yourself, to start crypto trading!
In simple words, a Digital Currency Exchange (DCE), or simply an exchange, provides a platform for buying and selling cryptocurrencies. Just like a stock exchange, assets are traded based on their current market price, and traders seek to make profits from their changing rates. Each exchange offers a different rate, based on the buying and selling activity on its platform. Since prices are always determined by the market, there is no stable price, but as a basic rule: the bigger the exchange, the more market-relevant is the price that it will offer. Typically, exchanges allow the conversion of fiat money, or regular currency into cryptocurrency and also crypto-to-crypto transactions. CoinDCX is a great place to start trading in cryptos!
How to start trading cryptocurrency in India?
The very first step is to register with an exchange, such as CoinDCX, and follow a series of verification processes, such as KYC (Know Your Customer) and linking a bank account, to establish the identity and credibility of the user. Once this is achieved, you need to buy some cryptocurrency to start trading. In case your chosen platform does not allow the purchase of cryptocurrency against fiat money, you need to buy some cryptocurrency on your crypto wallet and then transfer it as the initial deposit to your account.
You can trade in more than 250 altcoins on CoinDCX!
Where to spend cryptocurrency in the Indian market?
Evolving sentiments and favorable regulations have opened up avenues for cryptocurrency to be accepted as a valid means of payment for goods and services in the country. Online shopping is the best way yet to spend your digital riches. The e-commerce website Overstock accepts Bitcoin payments, as does India’s largest online bookstore SapnaOnline. Bitcoins can be utilized to buy a sea of products that Amazon offers, too, albeit indirectly by purchasing a gift card- essentially a way of converting bitcoin into INR. In fact, gift cards can be bought for a large number of brands across sectors such as Flipkart, Croma, Barbeque Nation, Big Bazaar, Cleartrip, Domino’s, Aeropostale, Allen Solly, Book My Show, Fabindia, Nykaa, Taj Hotels, VLCC, Westside, to name a few.
Some large companies like Windows and Xbox also process Bitcoins as payment on their online stores. Interestingly, Mumbai-based businesses such as pizza outlet Kolonial and spa-and-salon Castle Blue also accept bitcoin payments. Another offline establishment accepting Bitcoin payments in India is the restaurant Suryawanshi, in Bengaluru. In addition, it is also possible to pay mobile bills using bitcoin wallets. Charitable organizations such as the Human Rights Foundation are also taking the lead in accepting Bitcoin payments. Sign up for an account on CoinDCX and use your wallet to make payments at all establishments, digital or physical that accept cryptocurrencies!
The future of the BTC market in India
In over a decade of Bitcoin’s existence as the foremost cryptocurrency, it wouldn’t be an exaggerated claim to say that it is here to stay! As the Indian authorities are still trying to wrap their heads around this revolutionary technology, it is tech-entrepreneurs who have truly embraced it and are leading the way for digital assets in India. As a remarkable recent development, India’s largest exchange CoinDCX has received $13.9 million in new Series B funding led by DG, Jump Capital, Block.one, Uncorrelated Ventures, Mehta Ventures and Alex Pack, and our returning investors such as Coinbase Ventures and Polychain Capital.
Nevertheless, the current scenario is complicated: while Indians are keen on exploring this alternate currency universe, the central bank is worried that this will dilute its control on money. Alongside this, we also have companies discovering more and more real-world applications of blockchain and its power to change the world, such as with the smart contracts enabled by Ethereum.