Bitcoins have recently gathered a lot of interest among media and public. For most people, bitcoins are crypto-currencies. In simple words, this currency, instead of being a traditional paper note backed by governments across the world, are lines of computer code which have a monetary value based on pure demand and supply. These are created by lengthy and complicated mathematical computations and are supervised by millions of computer users – called the miners. So, comparing it with the ‘real money’ as we know it, this currency is issued by computer programs (and not central banks) and can be traded for goods.
Bitcoins can be earned (or mined) by solving complex mathematical problems and can be stored in virtual wallets. They can, then, be used to buy anything – merchandise, book tickets for flights or just about everything. What is interesting is that the record of these purchases is maintained on ‘blockchain’ – which only reveal the wallet IDs used for transactions. Individual details are not listed – so most of these transactions maintain a high level of anonymity.
One of the first recorded transactions has been where bitcoins were used to ‘pay’ for two pizzas!
How to buy and sell bitcoins?
With the advantage of anonymity and the recent surge in its value, everyone is interested in owning bitcoins. Even if not for exchanging them for goods – for keepsakes, or investment purposes. Buying these digital coins in India is easy – various online exchanges and platforms offer these currencies and some of them are listed below:
Coinome is perhaps the newest exchange on this list and is one of the most popular. Backed by the popular payment gateway service provider – Billdesk, Coinome provides easy methods of depositing funds (netbanking, debit cards, NEFT, etc) to purchase many crypto currencies including Bitcoin, Bitcoin Cash, Ripple, etc.
Coinsecure is another popular option in India to buy bitcoins. They are a bitcoin exchange portal and allows users to buy or sell bitcoins after completing their KYC formalities. They also verify users through a phone call to prevent fruad. While the interface is not very beginner friendly, they provide a lot of information on their portal.
On the other end of the spectrum, there is Unocoin. Their backend is relatively simple and easy to use unlike coinsecure and they even provide regular investments in bitcoins on a fixed schedule such as weekly, monthly or daily. They also provide an android application for those who want to trade bitcoins on the move.
Similar to unocoin, zebpay provides trading options through their mobile app and do not have a web based option. The mobile app is fairly straightforward to setup and get started. You can also exchange your bitcoins to purchase gift vouchers from popular stores such as Amazon, Flipkart, etc.
For those who do not want to go through the hassles of KYC or other documentation, Localbitcoins provide a easy way for users to find other users who want to sell their bitcoins offline. Think of it like a OLX or Quikr for bitcoins! They have members from over 240 countries whom you can trade with.
Other notable websites include Buyucoin and Coinbase. Once you have selected the platform, just create an account, and the bitcoin service provider will give you an online wallet for storing this currency. These also provide options and easy payment options to convert your local currency to bitcoins, and vice-versa. Although there is a high level of anonymity associated with bitcoins, in the Indian context, most of the platforms would require KYC or details like the PAN card or Aadhaar card details. Therefore, these are not completely private transactions.
Why should you buy or sell Bitcoins in India?
One of the foremost reasons for people being inclined to buy these bitcoins is the degree of appreciation in their valuation. Also, since most of the transactions are hard to track, more and more traders are using bitcoins to skim through the net of taxes. Additionally, their wide acceptability in the market as a usable currency is also making them a popular choice for increased interest in purchasing these.
How to keep bitcoins safely?
You must also be familiar with the news stories of bitcoins being stolen and, accounts being hacked. So, what steps should you take to keep these safely? Unfortunately, although, these cannot be put in a locker – there are other ways of keeping them securely. By using wallets that use multi signatures and maintaining a backup, you can keep your bitcoins safe. Also, since there is a high risk associated, online services must be used with caution – use only small amounts for everyday uses and keep a look out for proxy email sites that may fool you into believing that they are legit.
A word of caution – although more and more services are accepting payments through cryptocurrencies like the bitcoins, there is always a risk associated with trading these. Despite safety measures in place, instances of hacking have been rampant. Further, the government agencies are also waking up to the potential dangers associated with unregulated virtual currencies like these, and so, one cannot be certain as to when there might be a change in legislation with respect to their use and acceptability.