It’s a start, say Kolkata’s young crypto investors – Times of India

Kolkata: The government’s decision to levy 30% tax on gains arising out of transfer of cryptocurrencies and TDS of one per cent on payment made for transfer has drawn mixed response from retail investors and exchanges dealing in digital currencies.
While some investors have heaved a sigh of relief that the virtual digital assets have received some acknowledgement in the country’s Union Budget, others were left wondering whether crypto will be treated as an asset class or a currency in the coming days.
Finance minister Nirmala Sitharaman in her Budget speech also announced that there will be no deductions offered in the tax framework for cryptocurrency. She also announced that the Reserve Bank of India will issue a digital rupee in the next financial year.
Several retail investors had started squaring off their positions in cryptos last month when the government indicated that it is going to bring in a bill to draw up a framework to regulate the digital currency. This led to some selling off by retail investors.
“It is still not clear from the Budget speech what the future of the virtual assets is in India, but I am relieved that it has found mention in the speech and a tax has been levied which has brought some clarity over this asset class,” said Sunil Bhajanka, a retail investor in cryptos.
A cryptocurrency is a digital or virtual currency that is secured by cryptography. Most crypto currencies are decentralized networks based on blockchain technology — a distributed ledger. One of the most important features of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation. Except El Salvadore, no other country has recognised cryptos as a legal tender.
“The ambiguity around the status of crypto currency remains because the government has not clarified whether it will be a currency or just an asset class like stocks and mutual funds. A lot will depend on how the government decides to treat the virtual currency,” said Ashwin Agarwal, another crypto investor.
Cryptocurrencies like Bitcoin and Ethereum witnessed meteoric rise in valuation in the past 18 months or so.
An employee of an IT firm said: “Cryptos are very volatile. A lot of people I know made big gains,but I could not keep up with the market trend and pulled out my money a few months ago. I will wait for some more time before entering the crypto market once there is more clarity on the status.”