A tax rate on par with the lottery is the tip of the iceberg though, and crypto investors will need to be aware of other provisions as well, to remain on the right side of the law in the financial year 2022-23.

India is said to have almost ten million cryptocurrency users, seeing about $100 billion in trading volume in 2021. By the calculations of the founder of WazirX, an Indian crypto exchange, that could yield $100 million (or 750 crore) additional income tax in a year.

A person who bought a crypto asset that increased in value greatly, but is yet to sell it, by definition has made no profits yet. Such crypto asset holdings where one has not realised the gains, will not qualify for tax until some portion of it is sold.

For example, if you had bought Bitcoin worth 40,000 and sold it at the same price without any profit, you would get back only 39,600. If you then invest the same 39,600 into buying Ethereum or NFTs, and again sell at no profit, you would again lose 1% to TDS and get back only 39,204. This TDS collected can be set-off against the total income tax owed at the end of the year.

This effect of making people think twice about whether a prospective trade is truly worth it, and thus clamping down on speculative trades could be intentional. As pointed out by experts, this TDS could steeply reduce the volume of crypto trade in India, once it is implemented in July 2022.

Avoiding the 30% crypto tax, and showing crypto profits as capital gains which is taxed at upto 20% plus surcharge, will not be allowed either.

As for cryptocurrency mining, the government is mulling over whether to tax the activity as a goods or service, to bring it into the fold of GST. The government also wants to make crypto trade on foreign crypto exchanges subject to GST.

Professionals and business-people will not be able to set-off gains or losses between their primary income and crypto income.

Until the current fiscal year, employees, students and senior citizens whose overall income added up to less than the minimum tax threshold ( 2.5 lakh) were tax-free. But now with a targeted crypto tax, it isnt clear if those earning less than the tax threshold will still need to pay tax on their crypto income.

For the period ending in March 2022, tax filings by crypto investors can still show business expense deductions. However, those who are liable for advance tax payment will have to move fast. The last day for paying advance tax is 15 March 2022, and delaying would add an interest of one percent of the tax owed, for each months delay.

While the tax rate on crypto stands at a flat 30% for the year 2022-23, the tax rate upon stock trading can range from zero (if filed as business income in zero tax slab) to 15% (if filed as short-term capital gain).

The proposed framework for regulating crypto is yet to be presented in Parliament, but the finance ministry is said to be working on a consultation paper, which is expected to be released for public comments in six months.

Disclaimer: This is not intended to be financial advice. We recommend making any major decisions after speaking to your tax consultant. Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.

SEE ALSO:Adani group, IOC, BPCL, HPCL, Reliance, HDFC and other hot stocks on March 21The powerhouse behind Bored Ape Yacht Club has launched its own token, ApeCoin

Originally posted here:
Indias cryptocurrency tax kicks in from April heres what investors need to know - Business Insider India

At least 10,000 worth of Scotcoin, Scotlands first and only digital currency, has been transferred to the country to help provide much-needed goods and services.

Funds from the Glasgow-based firm are part of more than 37.5 million of crypto gifted to the Ukrainian nation and non-governmental organisations so far.

The move follows calls from Ukraine for donations of Bitcoin, Ethereum, Polkadot and Tether currencies, amid fears the war could cause chaos for the regular banking sector, leaving people without access to cash or rendering it worthless.

Temple Melville, chief executive of Scotcoin Project Community Interest Company (CIC), says the currency is playing an incredibly important role in supporting the people of Ukraine and fulfilling the function it was initially created for.

He contends digital funds are more secure than traditional money and can be transferred in milliseconds without involving big transaction fees.

We are all deeply moved by what we have seen happening in Ukraine, he said.

It is a human tragedy on a scale that is difficult to process.

For many people, including ourselves, the most practical way to provide support is through donations, and cryptocurrency is one of the best ways of ensuring it gets to the intended recipient securely and quickly.

This is exactly the type of situation cryptocurrency was set up to help, and the vast amount of it that has been sent to the Ukrainian government and organisations on the ground demonstrates the power it has to support those in need.

He says the transparency involved in crypto transfers is an important factor in situations such as this.

Anyone can view transactions on the blockchain and check donations have been delivered to the address intended, he said.

While there have been calls to block Russian users, the way the networks are set up mean their transactions could also be easily traced too.

The Ukrainian government has indicated it will start to take more cryptocurrencies soon, opening up more opportunities to directly donate to a country that desperately needs our help.

Scotcoin aims to use its currency known as SCOT and part of the Ethereum network as a vehicle to drive meaningful change for the economy, environment and society.

Its thought to be the only purpose-driven cryptocurrency in existence, with funds being used to support social and environmental projects at home and abroad including tree-planting schemes and seaweed cultivation in Scotland.

The company is actively building a network of organisations, including start-ups, that will trade locally in the currency and support the projects mission.

Target industries include those with significant issues of over-supply or waste, where goods and services can be diverted to people in need, and in green initiatives such as carbon capture and offset.

Scotcoin made its donation through BBX UK, a network where organisations can use cryptocurrency to buy spare products and services from other companies.

Five billion SCOT have been created and there will be no more.

Two billion have been issued and three billion retained by Scotcoin in treasury of which 20 million will be released annually to deliver social and environmental aims.

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Scottish cryptocurrency donations to help people in war-torn Ukraine - The Scotsman

The U.S. Federal Reserve is getting ready to start raising interest rates, sucking the bullish air right out of the market as investors reassess the valuations of risky assets like stocks. Cryptocurrencies have been hit hard too -- a reminder that while blockchain-based technology is exciting and has lots of potential in the coming decades, this is a very new and very volatile space to invest in. The top two cryptos by market capitalization, Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH), are each down over 40% from all-time highs as of this writing.

But given the potential for blockchain, I'm still dabbling (for me, that means less than 1% of my total investable net worth). This month, I'm adding to a very tiny existing position in Solana ( SOL -1.97% ). Here's why.

Image source: Getty Images.

Like Ethereum, Solana's blockchain network was designed to support decentralized applications (or dApps, meaning peer-to-peer interaction with no centralized control). Ethereum has thousands of dApps based on its network, while Solana only has a couple hundred, although there are dozens more in development.

Created a couple years after Ethereum and launched in 2020, Solana is getting lots of attention. Its network is one of the quickest out there, boasting the current ability to process up to 65,000 transactions per second (which is similar to Visa's (NYSE: V) implied network speed). That compares to Ethereum's current limit of about 15 to 30 transactions per second.

Solana uses a concept known as proof-of-stake (PoS) to verify transactions on the network. PoS allows owners of a crypto to participate in the validation process. Along with PoS, Solana also devised a concept called Proof of History, which embeds a time stamp into transactions so the network doesn't need to reach a consensus on which ones to validate first. As a result, fees for utilizing Solana (known as gas fees) can be as low as a fraction of a penny, which compares to as much as a couple hundred dollars on Ethereum.

The way I see it, the problem with investing in cryptocurrencies is there's no real way to value them. They aren't businesses. Rather, they're an asset that a business develops or utilizes (Solana Labs, the private company headed by CEO and Solana co-founder Anatoly Yakovenko, develops the Solana blockchain network). Like Bitcoin and Ethereum, Solana has thus taken a big hit as investors have fled risky investments (that is to say, those with more uncertain future values) in recent months. Its tokens are down nearly 70% in value from their all-time peak reached late in 2021. That gives Solana a "market cap" of nearly $26 billion as of this writing.

Cryptocurrency

Market Cap

Rank In Top 10 Most Valuable Cryptos

Bitcoin (CRYPTO: BTC)

$736 million

#1

Ethereum (CRYPTO: ETH)

$305 million

#2

Solana (CRYPTO:SOL

$25.8 billion

#9

Data source: as of March 14, 2022.

A cryptocurrency's price performance is indicative of its growing popularity among developers, as well as uptake among investors buying the tokens. Even after the recent downturn, Solana is up big since its launch, indicating the excitement surrounding the blockchain project.

Data by YCharts.

Another way to "value" a crypto could also be the rewards gained from staking, when a participant in a PoS blockchain network uses their tokens to help validate transactions and get rewards. Currently, Solana pays a 5.8% reward as of this writing(paid in more Solana tokens), less an average 9.8% fee taken from the reward. This compares to a 4.8% reward from staking Ethereum, minus an average 10.9% fee. However, the "adjusted reward," which takes into account growth of supply in overall tokens on the blockchain, is only 0.94%. Ethereum's adjusted reward is currently 4.36%.

For Solana in particular, a fast-growing increase in tokens will dilute an owner's stake in the crypto over time, unless they "stake" their position (which Solana explains how to do here). The short story: There's no way to put a concrete valuation on Solana like we can with a business. This is a highly speculative asset that will begin rising once again or continue falling in value based solely on demand.

But there are some exciting projects being built on Solana, like the recently announced Solana Pay that directly connects merchants and shoppers in a first-of-its-kind peer-to-peer blockchain payments solution. What that dApp could mean for merchants is near-instantaneous settlement of funds into their merchant accounts with close to zero fees (compared to a 3% fee of total transaction value utilizing Visa), and the ability to reward customers directly using other digital assets built on Solana.

As exciting as applications like Solana Pay sound, buying Solana tokens isn't a direct investment into it or any other business. It's a speculative bet. For a more low-risk, potentially high-reward play on blockchain technology, I prefer keeping most of my investment assets in businesses like Alphabet's (NASDAQ: GOOGL)(NASDAQ: GOOG) Google Cloud, Shopify (NYSE: SHOP), and even Coinbase Global (NASDAQ: COIN) -- companies that are using crypto and blockchain to generate revenue and profitability.

That's why I'm keeping Solana and other cryptos as a fraction of a percent of my investment value at this point. Solana is still small and its value could continue deteriorating. But if developers and other speculative investors continue to flock to it, this newer blockchain network could soar one day.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis even one of our own helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Continued here:
The 1 Cryptocurrency I'm Buying in March - The Motley Fool

Cryptocurrency has become the latest buzzword, and for good reason. Over the years, this digital currency has catapulted the interest of investors as well as governments alike. It has the potential to shake markets and change the investment landscape. Bitcoin, which traded at USD 0.0008 in 2010 jumped to almost USD 65,000 in April 2021. Many cryptocurrencies have been introduced and have reached levels, none could have predicted.

No wonder, countries all over the world have taken different approaches to regulate this new asset. However, most are yet to understand how crucial cryptocurrency has become in the global investment landscape. As a result, no nation, including the US, Japan, or the EU nations have a single and clear regulatory framework around crypto-related activities. The assorted regulations in different countries mean that cryptocurrencies are subjected to different regulations, based on varying global standards of classification and tax regimes.

Adopting a regulatory framework in India

After years of deliberation, the Indian government has finally made a decision around how cryptocurrencies will be treated in the country. In the recent budget speech on February 1, 2022, Indias finance minister Nirmala Sitharaman announced that the countrys central bank will issue Central Bank Digital Currency (CBDC), this fiscal year, which is the period between April 1 and March 31. She added that a 30% tax will also be levied on the income from the transfer of virtual assets.

The launch of CBDC is expected to make digital currency more efficient. Investors are keeping a close eye on the rollout by the Reserve Bank of India, in anticipation that the CBDC will reduce India's dependence on cash. It will also create an organised mechanism for the use of digital currency in the country.

Other countries have their regulations but a global standard mechanism has been missing. The high volatility of cryptocurrency due to unclear rules has often worried the investors, distancing them from large investments.

For instance, the value of Bitcoin reached a record high in November 2021 but tumbled at an alarming rate. Crypto pundits expect a gradual recovery this year. What investors require is a shield from such volatility along with decent returns.

How can PNP coin come to your rescue?

While there are several channels of cryptocurrency that exist, PNP coin will address most anomalies that exist about this digital currency. Launched by the Helios Groups, Hong Kong, the worlds first regulated cryptocurrency in the world, PNP coin aim to provide a regulatory framework, an adequate pool of liquidity, and participation from a wide range of well-established market participants. This adds to their status as a unique and well-established asset class that is capable of revolutionizing the crypto sector.

Helios groups will launch a Helios DAX(Digital Asset Exchange), a new crypto exchange where PNP will be listed. Not just PNP, but all the cryptocurrencies on the DAX exchange will be regulated. The exchange will follow all the major government regulations and offer a user-friendly experience with minimum slippage, as it uses the groups own patented AI technology.

The pioneer behind DAX, Helios is the first to initiate a regulated exchange. Helios groups have gained significantly from the first-mover advantage. The sixth stage of the Initial Coin Offering (ICO) has been completed recently, with 78% of the allotted tokens sold.

The limited number of PNP tokens at the time of listing helped in the creation of a rapidly increasing demand, with significant investments expected from HNIs (High Net Worth Individuals) and capitalists. The revenue from the PNP Coin's listing will be directed to Helios DAX Crypto Exchange. Helios Groups is committed to offering an easy-to-operate user interface that has been developed using their in-house and patented AI technology. Hence, users can stay rest assured of minimal errors or lapses.

Helios are optimistic about reaching their target of 1% of bitcoin's price by the year 2023 enabled by this new and regulated crypto exchange the Helios DAX!

To know more, click here

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Heres how Helios DAX is revolutionizing the cryptocurrency space - Mint