Gifting ‘crypto’ this Diwali; how crypto is the new favorite
As more and more young people continue to invest in digital assets and currencies, there is no doubt that it has gained a lot of traction. For example, The International Criminal Police Organisatioin aka Interpol recently created a special task force to monitor crypto-related crimes. At the same time, youth have invested with a goal of giving cryptocurrencies, non-fungible tokens (NFTs) and other virtual digital assets (VDAs) this holiday season. “Bitcoin was modeled as digital gold and we all know how much Indians love gold. Crypto can be an ideal choice because we present them with the future. A good investment in crypto can do wonders,” said Rajagopal Menon, Vice President of Marketing, WazirX, a crypto asset company, to FE Blockchain.
However, all VDAs gifted shall be taxable in the hands of the recipient under Section 56 (2) of the Income Tax Act, 1961, if the total value of gifts received within a year is greater than Rs 50,000. “Digital currency can be volatile , but is considered to be “digital gold” by new millennials. Sending stable coins like USDT and USDC can be a very stable form of gift. Bitcoin or Ethereum can also be a very good form of gift, as they are currently on the downside of prices,” said Amanjot Malhotra, Country Head – India, Bitay, a digital asset exchange.
According to Bloomberg, bitcoin has the potential to reach $100,000 in 2022 as the digital currency completes its shift from a risk-on to a risk-off asset. “Crypto gift cards can evoke the gift-giving sentiments during the festivities, while providing higher value for money. Overall, this will support the growth of India’s cryptocurrency industry and the global ecosystem,” asserted Sakina Arsiwala, co-founder, Taki, a Web3.0-based platform.
It should further be noted that the Income Tax Rules stated that specified movable properties acquired at a discount shall all be considered as gifts. “It is now time for people to not only invest in virtual currencies based on Blockchain technology, but to utilize the benefits offered by cryptocurrencies as a gift to others that has gained momentum over the years as a valuable resource,” Arsiwala further explained.
A recent survey by Cointelegraph revealed that among 84 professional investors worldwide, 3.3%, or about $10.42 billion, of the $316 billion in assets managed by respondents are invested in cryptocurrencies. “Bitcoin has registered a remarkable 100x improvement over gold as a store of value. The world has realized this rise in eminence and has begun to reprice digital currency in real time,” Malhotra added.
Also Read: Sachin Tendulkar partners with Rario to mark the cricketer’s foray into the NFT market
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