How to buy Bitcoin in India?

Paul Sazan
| Editor:
March 25, 2024
9 min read

Bitcoin's Legality in India

Bitcoin, the world's first and most popular cryptocurrency, has a somewhat complex status in India. While it's not recognized as legal tender, it's also not illegal to buy, sell, or hold Bitcoin in the country. However, traders and investors must ensure that they abide by the guidelines and regulations set forth by the government and financial institutions. This means conducting transactions with transparency, reporting taxable income, and avoiding illicit activities related to cryptocurrencies.

Basics of Bitcoin Investment

Investing in Bitcoin in India involves several key steps, including selecting a method to buy Bitcoin, choosing a reputable platform, and understanding the payment options available. Bitcoin can be purchased via various methods, such as cryptocurrency exchanges, peer-to-peer platforms, and Bitcoin ATMs, where users can buy Bitcoin with cash or credit/debit cards.

One recommended way to buy Bitcoin in India is to use a reputable cryptocurrency exchange, such as Binance. These platforms enable users to purchase Bitcoin with Indian Rupees (INR) following the completion of a registration and verification process. Some exchanges even allow users to buy Bitcoin directly through UPI (Unified Payments Interface) or NEFT/RTGS bank transfers.

When purchasing Bitcoin, it's also essential to consider how to securely store it. Most cryptocurrency exchanges offer digital wallets where users can keep their Bitcoin. However, it's also possible to use a separate, dedicated Bitcoin wallet for added security.

By understanding the legality and basic investment process, individuals can confidently navigate the process of buying Bitcoin in India. It's always important to stay updated with the latest guidelines and regulations to ensure a safe and legal investment experience.

Choosing a Cryptocurrency Exchange

If you're interested in buying Bitcoin in India, the first step is to select a reputable cryptocurrency exchange. Cryptocurrency exchanges are online platforms where you can buy, sell, or trade digital assets like Bitcoin.

Features of a Good Exchange

A good cryptocurrency exchange should offer a combination of essential features, such as:

  1. Ease of use: The exchange should have an intuitive and user-friendly interface, ideally with an accompanying mobile app for trading on the go.
  2. Security: Look for exchanges with robust security measures in place, such as two-factor authentication (2FA) and cold storage for funds.
  3. Liquidity: Exchanges with high liquidity typically offer more accurate prices and faster transactions.
  4. Payment options: The best exchanges offer a variety of payment options, including bank transfers, credit cards, and UPI.
  5. Customer service: Look for exchanges that offer prompt and helpful customer service, particularly if you're new to Bitcoin trading.

Top Exchanges in India

There are several trusted platforms where Indian users can purchase Bitcoin. Here are a few of the top exchanges:

  1. Binance: Known globally for its extensive asset selection and features, Binance allows Indian users to buy Bitcoin with INR after completing registration and verification.
  2. WazirX: A popular choice among Indian users, WazirX offers a seamless experience for purchasing Bitcoin with INR.
  3. CoinDCX: This exchange offers a wide range of cryptocurrencies and features, including futures trading and margin trading.
  4. ZebPay: One of the oldest Bitcoin exchanges in India, ZebPay offers easy ways to buy Bitcoin with INR.
  5. Unocoin: Unocoin is another well-established platform in India, offering a simple and straightforward way to buy Bitcoin.
  6. CoinSwitch Kuber: This platform stands out for its user-friendly app and competitive rates.

Remember, it's crucial to conduct your research and consider the characteristics of each exchange before deciding where to buy Bitcoin.

Buying Bitcoin in India

Once you understand the basics of bitcoin and its legality in India, the next step is to learn how to buy this cryptocurrency. This process involves setting up an account, verifying your identity, and funding your account.

Account Setup and Verification

To start the process of buying Bitcoin in India, you must first select a reputable cryptocurrency exchange such as Binance or WazirX. Once the platform is chosen, you need to create an account by providing your personal details.

Most exchanges in India require investors to undergo a basic Know Your Customer (KYC) process before they can start trading. This typically involves providing a PAN card, which must be linked to the bank account that you will use for fund withdrawals and transfers on the cryptocurrency exchange.

For instance, if you choose to use WazirX, you will need to complete their KYC verification by submitting the required documents. Once your identity is confirmed, you will be able to move on to the next step which is funding your account.

Funding Your Account

Once your account is set up and your identity is verified, the next step is to add funds to your account. The methods you can use to fund your account vary depending on the platform you choose, but most cryptocurrency exchanges in India allow users to buy Bitcoin directly through UPI (Unified Payments Interface) or NEFT/RTGS bank transfers.

For example, on the WazirX platform, once the KYC verification is complete, users can add funds to their account via various methods such as UPI, IMPS/NEFT/RTGS, and deposits from other wallets.

To do this, you would go to the 'Funds' section, select INR, and then click on 'Deposit & Withdraw'. After that, you can select 'Deposit' and proceed with the payment method of your choice.

It's important to note that the minimum investment required for purchasing Bitcoins in India varies. An investor can start from a minimum capital of Rs.100 and is able to purchase small units of Bitcoin if they do not wish to invest in an entire cryptocurrency, with potential variations in this limit across different crypto exchanges.

Once your account is funded, you are ready to buy your first Bitcoin. The steps for purchasing Bitcoin will vary depending on the exchange you choose, but most platforms make the process simple and straightforward for their users. Remember, investing in Bitcoin, like any investment, comes with risks, so make sure you do your research and invest wisely.

Buy bitcoin in Atomic Wallet

Atomic Wallet supports +300 cryptocurrencies and tokens, so you can buy Bitcoin as well as all sorts of top cryptocurrencies per your interest: Ethereum, Litecoin, Stellar, Ripple, Bitcoin Cash, etc through the simple and convenient interface using a credit card.

The process is the same for every asset, and it’s as easy as possible. Just follow a few steps below:

  1. Download the latest updated version of the Atomic Wallet app.
  2. Create your password and log in to a new wallet.

Don’t forget to save your 12-word backup phrase in a secured place as a hard copy or anyways you trust!

  1. Now open the Buy Crypto tab on the left menu available and set BTC (Bitcoin) as the exchange pair to USD (US Dollar) or EUR (Euro) as per choice.
  2. Go through the process and fill in the billing information, verifying your email address and phone number.
  3. Fill in the payment details, and click on the tab pay now.
  4. Enter your OTP (One Time Password) and click on the Submit button.
  5. Fill in the security standard form, attach the scan of your document and click upload document.
  6. As your payment is under process, meanwhile you can click on the tab return to Atomic wallet and see your transaction in the history tab from above. Your transaction is simply complete now. It could take a few minutes to update the transaction showing your purchase on the wallet, which surely is not a concern.

Please note the transaction failure or problematic behavior suspecting unsuccessful exchange will surely result to refund in your bank account immediately.

How to store Bitcoin

The art and science of storing Bitcoin are about keeping your private keys safe and yet remaining easily available to you when you want to make a transaction.

No hassle, no stress, it’s a fact that Atomic Wallet promises strong shield protection towards your assets. Your privacy is well protected with the password you create and a 12-word backup phrase, while the encrypted mechanism, which forms the mnemonic seed and the keys, saves your data on a PC or smartphone respectively. Apart from the high safety standards, Atomic Wallet has many other features, like a convenient, user-friendly interface, built-in exchange and buying options, its native token AWC (being traded on Binance DEX), membership program, 24/7 support service, and many more, which make the wallet one of the best options for Bitcoin and other cryptocurrencies.

Trading Bitcoin in India

Trading Bitcoin in India is a straightforward process once you've set up and funded your account. This involves placing a buy order and exploring different trading methods, such as spot trading.

Placing a Buy Order

To buy Bitcoin in India, one must first place a buy order on a cryptocurrency exchange. WazirX is a popular and trusted platform for buying Bitcoin in India, offering a seamless experience for purchasing Bitcoin with Indian Rupees (INR).

To start buying Bitcoin on WazirX, users need to create an account on the WazirX platform and complete their KYC verification by submitting the required documents. Once the KYC verification is complete, users can add funds to their WazirX account via various methods such as UPI, IMPS/NEFT/RTGS, and deposits from other wallets.

Users can easily buy Bitcoin on WazirX by going to the 'Funds' section, selecting INR, and then clicking on 'Deposit & Withdraw'. After that, users select 'Deposit' and proceed with the payment method of their choice. Once the funds have been deposited, users can then place a buy order for Bitcoin.

The process of placing a buy order typically involves specifying the amount of Bitcoin one wishes to purchase and the price at which they are willing to buy. Once the buy order is placed, it will be matched with a sell order at the same price, and the transaction will be completed.

Spot Trading and other Methods

Spot trading is the most common method of trading Bitcoin, where the transaction is settled "on the spot" once a buy order matches a sell order. This is ideal for beginners who are looking to buy Bitcoin for the first time.

However, there are also other trading methods available for more advanced users. These include margin trading, where users can borrow funds to trade larger amounts, and futures trading, where users can agree to buy or sell Bitcoin at a predetermined price in the future.

Bitcoin can also be purchased via peer-to-peer trading platforms where users can interact directly with sellers to buy Bitcoin. This can be a viable option for those who prefer to deal directly with other individuals rather than going through an exchange.

Regardless of the trading method chosen, it's important to remember that trading Bitcoin involves risk, and one should only invest what they can afford to lose. It's also crucial to store your Bitcoin safely in a secure wallet to protect against potential hacks or theft.

Storing Your Bitcoin Safely

After understanding how to buy Bitcoin in India, it's essential to learn how to store it securely. The storage of Bitcoin and other cryptocurrencies is carried out in digital wallets, which are secure platforms designed to hold and manage these digital assets.

Understanding Cryptocurrency Wallets

A cryptocurrency wallet, also referred to as a blockchain wallet, is a digital platform that securely stores cryptocurrencies like Bitcoin. These wallets don't just store Bitcoin, but also the keys required to carry out transactions. They incorporate encryption and digital signatures to assure the safety of the funds stored within them.

There are two primary types of cryptocurrency wallets:

  1. Hot Wallets: These are online wallets that run on internet-connected devices like computers, mobile phones, or tablets. They provide convenient access to your Bitcoin but can be vulnerable to online threats.
  2. Cold Wallets: These are offline wallets that store Bitcoin on a platform that is not connected to the internet. They offer enhanced security but might be less convenient for regular transactions.

Risks and Considerations

While the process of buying Bitcoin in India is becoming more straightforward, there are several risks and considerations that prospective investors need to bear in mind. Specifically, the market volatility of Bitcoin and the regulatory ambiguity surrounding its status in India are two significant factors.

Market Volatility

The cryptocurrency market, including Bitcoin, is known for its high volatility. This means that the value of Bitcoin can fluctuate widely in a very short period. While this volatility can offer high returns if the market moves in a favorable direction, there is also a risk of significant losses if the market moves against the investor's position.

For example, if an investor buys Bitcoin when the price is high and the market subsequently drops, the investor could lose a substantial portion of their investment. Therefore, individuals looking to buy Bitcoin in India must be prepared for these rapid and significant price changes and invest only what they can afford to lose.

Investors should also be aware that the volatility of the Bitcoin market can be influenced by a range of factors, including global economic conditions, technological developments, and changes in market sentiment. Keeping abreast of these factors and understanding how they can impact the price of Bitcoin can help investors make more informed decisions.

Regulatory Ambiguity

Another key risk to consider when buying Bitcoin in India is the regulatory ambiguity surrounding its status. Despite the increasing popularity of Bitcoin and other cryptocurrencies, the Indian government has not yet provided clear guidelines or regulations for their use. This lack of clarity can create uncertainty and risks for investors, as the legal status and future of Bitcoin in India remain uncertain.

This regulatory ambiguity means that the government may impose restrictions or regulations that could impact the value and usage of Bitcoin. For example, if the government were to ban the use of Bitcoin, this could cause the price to drop sharply. Similarly, if the government were to introduce strict regulations around the use of Bitcoin, this could limit its potential for growth.

In light of these risks, individuals looking to buy Bitcoin in India should stay informed about the latest regulatory developments and consider seeking advice from a financial advisor or legal professional. By understanding the potential risks and taking steps to mitigate them, investors can make more informed decisions about whether to buy Bitcoin in India.

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