Have Crypto? Here is a step-by-step guide to convert to INR
Cryptocurrency has recently emerged as a very popular investment medium in the contemporary world. This new-age digital currency is here to stay as it continues to contribute to the development of our economy. Cryptocurrencies are decentralized and are extremely volatile, even though we all know the value of cryptocurrency fluctuates considerably, we still see a steep rise in the number of people investing in cryptocurrencies like Bitcoin, Ethereum to name a few. Here are some top reasons why people like to buy cryptocurrencies.
- Convenience: Digital currency has a worldwide presence, making it accessible for trading from anywhere, at any time.
- Quick Transactions: Cryptocurrencies use blockchain technology, which makes the transactions fast, even if it is cross-border.
- Lower Transaction Fee: The cost of transactions using cryptocurrency is way lower than the other traditional exchanges.
A lot of people who invest in cryptocurrencies are clueless about how to use them. Unlike physical currency, you can’t use bitcoins or cryptocurrencies to pay for your dinner at a restaurant, but you can convert the bitcoin to INR in a few simple and easy steps. Some online sites accept cryptocurrencies as a mode of payment when you make a purchase, however, the choices are very limited. To a greater extent, you will be required to convert the digital coins into cash, and since the value of these coins fluctuates, the timing is crucial to avoid losses. A lot of us feel that Cryptocurrencies aren’t yet regulated by the Indian government, there would be no taxes levied, then let us tell you that even when you cash out your crypto, you will have to pay some amount of taxes on the profit made.
Here are two widely used ways to convert any type of cryptocurrency into cash –
Method 1: Through an Exchange or a Broker: There are several exchange platforms and third-party brokers available these days that will help you convert cryptocurrency for example Ethereum to INR. These work similar to the money exchange services that are available at the airports, where you can buy and sell currencies worldwide. This is a secure method of converting your cryptocurrencies into cash, however, third-party brokers charge a substantial transaction fee, and it is a time taking process.
In general, once you decide to convert your bitcoins or any other crypto into cash, you will have to put in a withdrawal request on the exchange platform, and within a week the amount as per the requested day’s value will be transferred to the linked bank account that you would have used during registration and purchase of the crypto. Due to money-laundering restrictions, the funds can be transferred only to your registered account that you use for trading, and no other payment withdrawal options are provided.
It’s best to rely only on trusted crypto exchange sites like Coinswitch Kuber to get the best value at zero brokerage fees. You can begin by following the below 3 easy steps
- downloading the app from the Play Store or App Store.
- Complete your KYC (which takes only about 5 minutes).
- You can start buying, selling, and trading over 80+ cryptocurrencies in just a few clicks.
Method 2: Peer-to-peer transfer: If you are looking for a quicker way to convert your crypto into INR, then the peer-to-peer transfer will work well for you. As the name suggests you can sell your crypto to your peers for cash, and this is an anonymous method because you can even use a VPN to secure your connection. Moreover, in this method lesser fee is charged when compared to the third-party broker, and you even get to choose the mode of payment. There are chances that you could even get a higher exchange rate from the peer-to-peer transfer method.
The only thing you need to be careful of while using this method is to beware of imposters. Under the pretext of buying your crypto at a better rate, they can even con you for your coins without making the payment. There are several platforms available that allow peer-to-peer conversion of crypto to INR, it’s best to look for one that gives you the ability to lock your bitcoins also known as the escrow option until you have received the complete payment. Once you have signed up with the peer-to-peer platform, you can then use the marketplace to send the trade request to the buyers based on your preferred location.
Indian Tax Rule
As mentioned earlier, while there are no specific tax rules laid out for cryptocurrencies under the Indian Income Tax Act, any income or profit that has been generated using the cryptocurrency exchange, one is required to pay taxes on it. Any cryptocurrency to bank account transfer involves a transaction fee, and all the exchange transactions are reported by reputed brokers for tax purposes.
We hope the above methods have given you clarity on how you can move your crypto into cash.