This blog post will provide a comprehensive overview of DeFi, explaining what it is, how it works, and its key benefits and risks. We will also discuss some of the most popular DeFi applications and how to get started with DeFi.

Meta: Description: This blog post provides a comprehensive overview of decentralized finance (DeFi), explaining what it is, how it works, and its key benefits and risks. We will also discuss some of the most popular DeFi applications and how to get started with DeFi.

What is decentralized finance (DeFi)?

Decentralized finance (DeFi) is a new and rapidly evolving financial system that uses blockchain technology to enable peer-to-peer financial transactions without the need for intermediaries. DeFi applications are built on public blockchains, such as Ethereum, and use smart contracts to automate financial transactions.

Smart contracts are self-executing contracts that are stored on a blockchain. They can be used to create a wide range of financial products and services, such as lending platforms, decentralized exchanges, and insurance products.

How does DeFi work?

DeFi applications use a variety of different mechanisms to enable peer-to-peer financial transactions. For example, lending platforms allow users to lend and borrow cryptocurrencies without the need for a bank or other financial institution. Decentralized exchanges allow users to trade cryptocurrencies without the need for a centralized exchange. And insurance products allow users to protect themselves against financial losses without the need for an insurance company.

Benefits of DeFi

DeFi offers a number of benefits over traditional financial systems. Here are a few of the most important benefits:

• Transparency: All DeFi transactions are recorded on a public blockchain, which makes them transparent and auditable.
• Accessibility: DeFi is open to everyone, regardless of location or financial status.
• Efficiency: DeFi applications are often more efficient than traditional financial systems, as they can automate many of the manual processes involved in financial transactions.
• Innovation: DeFi is a rapidly evolving ecosystem, with new applications and services being launched all the time.

Risks of DeFi

While DeFi offers a number of benefits, it is important to be aware of the risks involved. Here are a few of the most important risks:

• Volatility: The cryptocurrency market is highly volatile, which means that the value of your investments could fluctuate wildly.
• Smart contract risks: Smart contracts are complex pieces of code, and there is always a risk that they could contain bugs or vulnerabilities.
• Scams and hacks: DeFi applications are a target for scammers and hackers, so it is important to be vigilant and take precautions to protect your assets.

Popular DeFi applications

There are a number of popular DeFi applications that offer a wide range of financial services. Here are a few examples:

• Aave: Aave is a lending platform that allows users to lend and borrow cryptocurrencies.
• Uniswap: Uniswap is a decentralized exchange that allows users to trade cryptocurrencies without the need for a centralized exchange.
• Synthetix: Synthetix is a platform that allows users to create and trade synthetic assets, which are assets that track the price of real-world assets, such as stocks, commodities, and fiat currencies.
• Nexus Mutual: Nexus Mutual is a decentralized insurance platform that allows users to protect themselves against financial losses.

How to get started with DeFi

If you are interested in getting started with DeFi, there are a few things you need to do:

1. Create a cryptocurrency wallet: You will need a cryptocurrency wallet to store your cryptocurrencies and interact with DeFi applications.
2. Purchase cryptocurrencies: You can purchase cryptocurrencies from a cryptocurrency exchange.
3. Connect your wallet to a DeFi application: Once you have purchased cryptocurrencies, you can connect your wallet to a DeFi application to start using its services.

Conclusion

Decentralized finance (DeFi) is a new and rapidly evolving financial system that offers a number of benefits over traditional financial systems. DeFi is transparent, accessible, efficient, and innovative. However, it is important to be aware of the risks involved, such as volatility, smart contract risks, and scams and hacks.

Introduction to Crypto Communities

A cryptocurrency community can be defined as a collective of individuals who share a common interest in investing in cryptocurrencies. These groups of people typically gather on various social media platforms to exchange information, ideas, and viewpoints, or seek clarification.

Given the intricacies of cryptocurrencies, investors who are part of these communities utilise them as a valuable resource for expanding their knowledge in this field. What sets these communities apart is that their members actively participate in their governance structure, contributing to decision-making processes through voting or consensus agreements.

These community members convene on social media platforms such as Reddit, Discord, WhatsApp, Twitter, Medium, among others. The interactive dialogues fostered by crypto communities have played a pivotal role in advancing the success of cryptocurrency technology.

Importance of the Crypto Communities

A cryptocurrency community plays a pivotal role in the triumph of a cryptocurrency venture. The decentralised nature of cryptocurrencies has presented various challenges, some of which can be effectively addressed when individuals come together to exchange ideas, express viewpoints, and seek clarifications.

Within a cryptocurrency collective, members gain insights into the trajectory of a project, its objectives, and the strategies employed to realise those goals. Cryptocurrency projects are typically conceived as solutions to existing problems, as exemplified by Bitcoin’s creation as an alternative to the conventional financial system. Over time, what initially started as a small group of enthusiasts grew into a substantial community as Bitcoin achieved success.

A cryptocurrency community serves as a valuable resource for newcomers, investors, and project creators alike, mirroring the intricate social structures observed in certain insect colonies. Notably, a cryptocurrency collective assumes a central role in determining the success of a blockchain startup and can even influence the longevity of cryptocurrency projects.

Advantages of Engaging in Crypto Communities

Participating in a crypto group can offer several advantages, including:

Enhanced Communication

Crypto communities provide a platform for both cryptocurrency novices and investors to exchange thoughts and remain well-informed about ongoing projects and industry developments. It serves as a resource for resolving queries and ensuring safe engagement in crypto activities through proper guidance. The shared information within the group can act as a safeguard against falling victim to cryptocurrency scams and similar risks.

Access to Exciting Opportunities

Active involvement in a crypto community exposes you to various avenues for generating income. Networking opportunities often arise as people become part of the community, enabling members to discover new projects, products, and services. This newfound awareness can lead to profitable ventures.

Create a Sense of Belonging

Members of a crypto community not only have a voice within the project but also the potential to influence decisions through their ideas and contributions. The collective success of such initiatives directly benefits the community members who have actively contributed. Furthermore, these groups facilitate interaction with a diverse range of individuals, including newcomers, traders, and platform proprietors, fostering a sense of belonging and collaboration.

Insights into Crypto Communities and Their Influence

Building and nurturing a robust crypto community requires careful planning and strategic execution. Whether you’re launching a new project or seeking to revitalise an existing one, here are essential insights into community building.

Craft a Compelling Narrative

Bitcoin’s success is attributed, in part, to its captivating story. Your project should also have a unique and engaging narrative that resonates with both newcomers and veterans in the crypto space. Beyond being interesting, your story should address a specific problem and offer solutions that inspire others to join your cause.

Leverage Social Media for Growth

Social media platforms serve as the linchpin of your marketing strategy. They offer a dynamic space to cultivate and expand your crypto community. Platforms like Facebook, Twitter, Telegram, Instagram, Discord, and Reddit are invaluable tools for spreading the word about your crypto project.

Foster Active Engagement

To maintain an active and vibrant community, consistently share information, ideas, organise airdrops, host meme contests, and conduct giveaways. These activities not only keep your members engaged but also attract like-minded individuals to join your community.

Seek Expert Assistance

Leverage the expertise of professionals who have successfully built crypto communities. Additionally, consider collaborating with agencies that specialise in community creation and management. Their experience can be instrumental in your community-building efforts.

Monitor Community Growth

Monitoring your community’s growth and assessing key metrics is vital. Tools like Google Analytics and Segment can help you track and measure your community’s performance. Regularly reviewing these insights ensures that you’re on the right track.

Conclusion

A crypto community is more than just a gathering of individuals; it’s a powerhouse that can drive the success of your blockchain project. Crypto beginners, investors, and project creators can reap substantial benefits from a well-organised and engaged community. Platforms like Reddit, Discord, Twitter, and other social media channels are the epicentres of crypto enthusiasts, making them essential spaces for community development and growth.

Introduction

Cryptocurrencies have captured the attention of investors and tech enthusiasts in India and around the world. In 2022, the Indian government acknowledged these digital assets, known as Virtual Digital Assets (VDAs), and introduced taxation rules for them. As of 2023, understanding cryptocurrency taxes in India is crucial for anyone involved in this burgeoning space. In this blog, we are going to see everything about the Cryptocurrency Taxes in India. We will break down the essentials, including tax rates, TDS, and income tax implications, to help you understand the Indian cryptocurrency tax scenario.

Is Crypto Currency Taxable in India?

Cryptocurrency is indeed subject to taxation in India. In the 2022 Budget, the Indian government formally recognised cryptocurrencies as Virtual Digital Assets (VDAs), ushering in a structured framework for VDA taxation.

When it comes to the tax implications, here’s what you need to know:

30% Tax on Profits: Whether you’re trading, selling, or using cryptocurrency for transactions, profits from these activities are subject to a uniform 30% tax rate.

1% Tax Deduction at Source (TDS): If your cryptocurrency asset sales exceed ₹50,000 (or ₹10,000 in specific cases) in a single financial year, a 1% Tax Deduction at Source (TDS) is applied. It’s essential to note that additional income earned from activities like staking or mining may also incur Income Tax at your individual tax rate.

How Crypto Is Taxed in India 

Cryptocurrency Taxes in India is defined by Section 2(47A) of the Income Tax Act, which meticulously outlines the term Virtual Digital Assets (VDAs). In essence, this definition encompasses a wide array of crypto assets, including cryptocurrencies, NFTs, tokens, and more.

The financial year 2022-2023 brought about significant changes with the introduction of Section 115BBH in the 2022 budget. This section imposes a 30% tax rate (plus applicable surcharges and a 4% cess) on profits arising from cryptocurrency trading conducted on or after April 1, 2022.

This 30% tax rate aligns with India’s highest Income Tax bracket, excluding surcharges and cess. It applies uniformly to private investors, commercial traders, and anyone involved in crypto asset transfers within a given fiscal year. Notably, this tax rate remains consistent irrespective of income nature, be it investment income or business income, and it disregards distinctions between short-term and long-term gains.

However, the tax implications extend beyond this 30% rate. Section 194S introduced another facet of taxation, imposing a 1% Tax Deduction at Source (TDS) on crypto asset transfers occurring on or after July 1, 2022, for transactions surpassing ₹50,000 in a financial year (or ₹10,000 in specific instances). This measure aims to comprehensively monitor all cryptocurrency transactions.

Fast forward to the 2023 Budget, and Indian investors engaged in crypto and NFT trading must categorise their income. If assets are held for investment purposes, they fall under the category of capital gains. Conversely, if assets are held for trading, they are considered business income.

For the Income Tax Return (ITR) in the fiscal year 2022-2023, the ITR forms now incorporate a dedicated section called Schedule – Virtual Digital Assets (VDA) for reporting gains from Crypto and NFTs. The deadline for filing the Income Tax Return for FY 2022-23 is July 31, 2023, with the option to submit a belated return until December 31, 2023.

Determining When the 30% Tax Applies to Crypto in India

The 30% tax becomes applicable when you engage in the following transactions:

• Selling cryptocurrency for Indian Rupees (INR) or another fiat currency.
• Trading one cryptocurrency for another, including stablecoins.
• Making purchases using cryptocurrency for goods and services.

However, the 30% tax does not uniformly apply, as the Income Tax Department (ITD) may sometimes categorise your actions as income receipts. In such instances, you are subject to tax based on your Individual Tax Rate upon receipt. This includes scenarios like:

• Receiving cryptocurrency as a gift
• Earning income through cryptocurrency mining
• Receiving payments in cryptocurrency.
• Earning staking rewards.
• Receiving airdrops.

Understanding the 1% TDS on Crypto Assets

When you transfer a cryptocurrency, a 1% Tax Deduction at Source (TDS) is applied. TDS is a way to collect tax at the source of the transaction. The main reason for this 1% TDS is to track transactions and monitor cryptocurrency investments by Indian investors.

In simpler terms, TDS is a tax collected during crypto transactions. Here are key points to remember:

The 1% TDS started on July 1, 2022.

On Indian cryptocurrency exchanges, the exchange deducts TDS for you.

If you trade on P2P platforms or international exchanges, the buyer must deduct TDS.

Crypto-to-crypto transactions also have a 1% TDS for both the buyer and seller.

If you’re a specified person and your crypto trading doesn’t exceed ₹50,000 in a year, no TDS is needed.

What’s a specified person?

A specified person is an individual or a Hindu Undivided Family (HUF). The ₹50,000 limit drops to ₹10,000 if:

• Your business income is up to ₹1 crore or you had no business income last year.
• Your professional income is up to ₹50 lakhs or you had no professional income last year.
• For Indian exchange users, TDS is managed by the exchange. But for P2P and international trades, specified persons must submit TDS within 30 days using Form 26QE (not available yet on the income tax portal). Others need to get a Tax Deduction Account Number (TAN), file Form 26Q quarterly, and pay TDS by the 7th of the next month.

Lastly, you can reduce your tax when filing by claiming a TDS credit.

Conclusion

Cryptocurrency taxation in India has seen significant developments with clear guidelines and penalties for non-compliance. Investors must understand the implications of the 30% tax on crypto profits, the 1% TDS on transfers, and the new reporting requirements introduced in the 2023 Budget. It’s crucial to categorise income correctly and meet filing deadlines to avoid penalties. As the crypto tax landscape continues to evolve, staying informed and complying with the law is essential for Indian crypto enthusiasts and investors.

Since the first Bitcoin ATM opened in Vancouver, Canada, in 2013, the global crypto ATM network has experienced remarkable growth, with a significant presence in the United States. In 2014, the United States saw a substantial increase in ATM installations, solidifying its position as a key market for these machines. This surge can be attributed to the growing acceptance of digital currencies, user-friendly interfaces, and rising interest in decentralised finance (DeFi) solutions.

Key Stats

What is a Crypto ATM?

A Crypto ATM, short for Crypto Automated Teller Machine, is a standalone electronic kiosk that facilitates the purchase and sale of cryptocurrency using cash or a debit card. While all crypto ATMs provide access to Bitcoin, some also support other cryptocurrencies. It’s important to note that not all crypto ATMs support selling cryptocurrencies; some are exclusively designed for buying them.

Unlike traditional ATMs that link to your bank account, crypto ATMs operate by connecting to a user’s digital wallet to process transactions and transfer the purchased cryptocurrency to the customer. Globally, there are tens of thousands of crypto ATMs, with a significant concentration located in the United States.

Top Companies in Crypto ATM

In the cryptocurrency ATM industry, several notable companies have emerged as key players. These ATMs serve as a bridge between traditional fiat currency and cryptocurrencies, allowing users to buy, sell, or exchange digital assets conveniently. Key Companies in the Crypto ATM market include:

• BITCOIN DEPOT
• Bitstop
• Cash Cloud Inc
• Coinsource
• Covault LLC
• GENERAL BYTES s.r.o.
• Genesis Coin Inc.
• Kurant GmbH
• Lamassu Industries AG
• RockitCoin

Scope of the Report – Crypto ATM Market:

How Crypto ATMS Work 

Crypto ATMs operate by connecting to a cryptocurrency exchange, where they convert deposited cash into digital currency. Transactions are securely recorded on the blockchain, a digital ledger for cryptocurrencies. To use a crypto ATM, users typically link their digital wallet via a QR code, deposit cash, and receive the purchased cryptocurrency directly into their wallet.

Certain crypto ATMs utilise exchange apps to redeem cash vouchers, enabling users to deposit funds, choose their desired cryptocurrency, and then generate a voucher that can be scanned with a mobile app for depositing funds into their wallet.

While most crypto ATMs support one-way transactions (buying only), some offer two-way functionality, allowing users to both buy and sell cryptocurrency for cash. The selling process involves scanning the wallet QR code, specifying the amount of crypto to sell, and receiving cash from the ATM after the transaction is processed.

Why Crypto ATM’s are Surging  

The surge in crypto ATMs can be attributed to the growing popularity of cryptocurrencies, the need for accessible and secure on-ramps to digital assets, and the ongoing evolution of the crypto landscape. These ATMs provide a tangible link between the traditional financial system and the decentralised world of cryptocurrencies, making them a crucial tool for enthusiasts and investors alike. Some of the reasons are discussed below: 

Increasing Adoption of Cryptocurrency: As cryptocurrencies gain broader acceptance and become a mainstream investment, more people are seeking convenient ways to buy and sell digital assets. Crypto ATMs offer a tangible and user-friendly solution for this growing demand.

Accessible Entry Point: Crypto ATMs provide an accessible entry point for individuals interested in cryptocurrencies, especially those who may not be tech-savvy or lack access to online exchanges. Users can easily convert cash into crypto and vice versa without the need for a bank account.

Privacy and Security: Many users appreciate the privacy and security offered by crypto ATMs. Transactions are often conducted in person, reducing the risk of online fraud or hacking associated with traditional exchanges. Users can also store their assets in personal wallets, enhancing security.

Diversification of Cryptocurrencies: While Bitcoin remains the dominant cryptocurrency, the availability of other digital assets at some crypto ATMs allows users to diversify their crypto portfolios. This appeals to investors seeking opportunities beyond Bitcoin.

Global Expansion: The global spread of crypto ATMs means that users from different countries can access these machines, contributing to the worldwide adoption of cryptocurrencies. This expansion is making crypto more accessible on a global scale.

DeFi and Decentralisation: The rise of decentralised finance (DeFi) platforms has piqued interest in blockchain-based financial services. Crypto ATMs serve as a tangible bridge between traditional finance and DeFi by enabling users to interact with digital assets physically.

Resilience and Growth: Despite occasional fluctuations, the crypto ATM network has displayed resilience and continued growth over the years. This stability and expansion underscore the sustained demand for these machines.

Conclusion 

Crypto ATMs offer a straightforward and convenient way for individuals to buy and trade digital assets. Users can utilise cash or credit/debit cards to perform cryptocurrency transactions on these self-service devices. To use a crypto ATM, individuals need to create a digital wallet or scan an existing one, follow the provided instructions to select their transaction type (buy or sell), input the desired amount, and complete the payment. The ATM then either transfers the corresponding cryptocurrency to their wallet or dispenses cash equivalent to the value of the sold digital asset.

In the world of cryptocurrency investments, trust is paramount. Investors rely on experts to guide them towards promising opportunities, but sometimes, trust is shattered, and justice prevails.

In a significant development, Rashawn Russell, a former Deutsche Bank investment banker, pleaded guilty on Tuesday to charges of misappropriating funds from unsuspecting investors. His promise of substantial returns from cryptocurrency trading lured clients, only to betray their trust. As the U.S. Justice Department announced, Russell now faces the daunting prospect of up to 30 years in prison when he is sentenced. Additionally, he is obligated to make restitution payments exceeding $1.5 million as part of his plea agreement.

‘Russell leveraged investor interest in cryptocurrency markets to perpetrate a scheme to defraud clients who trusted him’ stated United States Attorney Breon Peace.

Russell, whose employment history spans from July 2018 to November 2021, worked at an undisclosed financial institution before his indictment. According to his LinkedIn profile, he joined Deutsche Bank as an investment banking analyst in July 2018 and was promoted to associate in July 2020.

Lured by Russell’s purported credentials as a licensed broker with expertise in investment banking, prospective investors believed they had found a golden opportunity. He claimed to manage R3, a cryptocurrency fund, promising substantial and sometimes guaranteed returns.

However, behind the scenes, Russell’s actions were far from transparent. While some funds were transferred to a trading account, he secretly diverted the rest. Investors received fraudulent documentation, misleading them about the performance of their investments. Russell’s deceptive web extended to friends and colleagues, from whom he solicited investments, only to divert these funds towards gambling and personal expenses, according to federal prosecutors.

This case underscores the ongoing efforts by U.S. prosecutors and regulators to combat fraudulent activities in the digital asset space, emphasising the importance of investor protection and market integrity.

When Russell faced charges in April, Deutsche Bank stated that, while it would refrain from commenting on ongoing legal proceedings, it remained committed to supporting law enforcement and regulatory oversight efforts. This included cooperating with authorised investigations and proceedings.

In conclusion, this cautionary tale serves as a stark reminder of the vigilance required in the cryptocurrency realm. As the digital asset market continues to evolve, it is crucial for investors to exercise due diligence and seek reputable advisors.

The cryptocurrency market is teeming with opportunities and risks. Rashawn Russell’s case highlights the critical importance of verifying the credentials and trustworthiness of financial professionals in the crypto space. To protect your investments, always consult experts who can provide transparent and ethical guidance in this ever-evolving landscape.

At Vakilsearch, we understand the importance of safeguarding your investments. Our team of legal experts is dedicated to providing you with comprehensive guidance and support in the cryptocurrency and financial sectors. Trust us to help you navigate the complexities of this dynamic market and protect your interests. Contact us today to secure your financial future.

Cryptocurrencies experienced a bullish surge on Tuesday as investors awaited the Federal Reserve’s policy meeting outcome. Bitcoin, the leading crypto token, exhibited mild gains, inching closer to the $27,000-level. Ethereum also saw marginal growth, maintaining its position above $1,600. The broader altcoin market showed positive price action early in the day.

In the last 24 hours, the crypto market has traded sideways with an upward bias. Bitcoin, in particular, had a positive streak, touching $27,400 before a slight pullback. Shubham Hudda, Senior Manager at CoinSwitch Markets Desk, noted, ‘The last 8 days have been pretty positive for the crypto market, with Bitcoin rebounding about 10 percent from its recent lows.’

Chainlink and Solana have been standout performers, with significant momentum. Hudda highlighted their potential, saying, ‘With giants like financial service provider SWIFT using Chainlink’s infrastructure, we can see a significant upside if this momentum continues.’

With the exception of a few, most top crypto tokens traded higher. Notable gainers included Toncoin, Solana, Litecoin, XRP, and Cardano, while BNB, Polkadot, and Shiba Inu experienced slight declines.

The global cryptocurrency market cap increased slightly to reach the $1.07 trillion mark, with a 24-hour gain of about 1 percent. Meanwhile, total trading volumes surged over 63 percent, reaching $30.13 billion.

Chainlink (LINK), known for its blockchain abstraction layer, has shown a promising trend. It broke out of its consolidation phase, with a chart that breached the descending trendline, accompanied by strong volume buildup. Analysts expect an upward trajectory, with resistance at 7.33 USDT and solid support at 5.01 USDT.

Our financial analysts are optimistic about the ongoing surge in the cryptocurrency market. They have conveyed that the revival of Bitcoin and the strong performance of alternative cryptocurrencies such as Chainlink and Solana reflect a bullish sentiment. It is advisable for investors to closely monitor these developments as they have the potential to result in significant profits within the cryptocurrency market.

As the cryptocurrency market continues to show resilience and potential, it’s essential for investors to navigate this complex landscape with legal expertise. Vakilsearch offers comprehensive legal services tailored to the unique needs of crypto enthusiasts and investors. Whether you require legal guidance for investments, regulatory compliance, or contract matters, Vakilsearch is here to support your crypto journey.