Bitcoin and for that matter trading in other cryptocurrencies is fast gaining traction in India too despite regulations regarding them being still remaining unclear. The fast adoption of bitcoin as a mainstream asset by institutional investors, the recent adoption of bitcoin as a legal tender in El Salvador have been creating interest in these cryptocurrencies. Other than that these are deemed to be no less than gold being seen as a suitable hedge against inflation.
All About the cost involved in trading in bitcoins and other cryptocurrencies in India:
But before getting into transacting in Bitcoins and other cryptocurrencies like with stock, gold etc., you need to be KYC compliant i.e. need to furnish the available crypto exchange all such requisite documents including PAN, aadhaar, bank account details, cancelled cheque etc.
1. Transaction/Trading fees:
Generally in India, maker-taker model is followed for the purpose of deciding the fee structure. Some others like Zebpay have decided a fee as monthly membership fee equivalent to 0.0001 BTC and that can be avoided by engaging in at least one bitcoin trade every month.
'Maker' is an individual or entity who sets the price and 'taker' is the one who matches the price.
As per buyucoin.com i.e. a global cryptocurrency exchange and wallet in India, the maker-taker fee per trade is 0.24% i.e. inclusive of GST.
2. Withdrawal fees:
This is charged when you intend to sell your bitcoin or other cryptocurrency holdings. Now here you need to ensure up to what decimal figure your exchange is allowing you to transact as it is in a general case allowed only up till the 4th decimal, while cryptos are created up till the 8th decimal. So, this precisely tell up to what decimal you can sell your holding.
Further withdrawal fee varies from crypto to crypto and is stated as 0.001368 in case of bitcoin for max withdrawal of 10 BTC.
In the cae of Ethereum it is 0.00864 Ethereum as per buyucoin.com
3. Deposit fees:
In the case of Zebpay as per the site all crypto deposits are fee. And further depending on the transfer method, the fees varies say for instance if it is via net banking the fees is Rs. 10 and for bank transfer it is Rs. 7. Also, there are specified deposit limits in respect of each of the cryptocurrencies i.e. both minimum and maximum.
Likewise Buyucoin platform also does not charges any deposit fees for trades in cryptocurrencies via its platform/
Other than these fees, you will also be liable to pay taxes on the capital gains you realize by selling these cryptocurrency holdings. Herein while there are many facets and aspects that need to be considered while deciding on the taxation aspect, if we consider the trade engaged in them as investment then for long term gains taxation of 20% post indexation shall apply, while short term capital gains will be taxed considering the individual slab rate.