 "A document said that an IRS agent recently found three cases in which people were using Bitcoin to evade taxes istock")
Bitcoin has emerged as the most remunerative asset in 2016. Analysts are bullish on the asset class which has surpassed almost all others. Even gold, which was considered a safe avenue in times of crisis, has given up almost all the gain it has made during 2016.
In 2016, Bitcoin price has more than doubled and quoting around $875 (about 60,000), after touching a high of $916 last week. However, price movement in India was much sharper in the past three months. On Zebpay, one of the largest Indian bitcoin exchanges, in last three months, prices have increased from Rs 41,250 per unit to Rs 62,000. In November it touched a high of Rs 69,500, an all time high due to 40 per cent premium to international price, following a confidence crisis and search for alternative asset increased in India after demonitisation of Rs 500 and Rs 1,000 notes. However, later some overseas remittances came in to add to supply and some profit booking helped premium to settle 8-10 per cent to international prices.
Analysts say China has the largest trading in Bitcoin and Chinese buy it to hedge against falling Chinese currency. Yuan is trading at eight years low following dollar index trading at around its all time high a week ago. And, recent remark by China’s President Xi Jinping that he isn’t wedded to China’s 6.5 percent economic growth objective due to concerns about rising debt and an uncertain global environment after Donald Trump’s election win in the US, according to a person familiar with the developments, has further provided boost to Chinese demand for Bitcoins.
Even informal restrictions on gold import implemented by China since last one month to curtail outflow of Yuan, Chinese investors have found safe haven in the crypto currency, resulting in higher demand taking its price up further. China had already introduced slew of property investment curbs in 2016 which are likely to stay in place in 2017 also.
Sandeep Goenka, co-founder and Director of Zebpay, Indian Bitcoin Exchange, said, “It was widely forecast that bitcoins price would see a spectacular increase in 2016. Geopolitical events and a weak global economy led to a bitcoin price increase from Rs 25,000 at the beginning of 2016 to around Rs 65,000 right now. In 2017, major technical upgrades are expected. Demand for bitcoins will continue to increase. I believe in 2017, bitcoin will touch all time highs and end 2017 with a price would more than double from the current levels per bitcoin.”
Compared to this gold price in India went up 11 per cent and silver by 17 per cent in 2016 so far.
Following announcement of EY Switzerland, a leading global accounting firm, that it will accept fees in Bitcoin, interest in Indian professionals also increased for accepting fees in this crypto currency, according to the analyst tracking Bitcoin.
Even interest in Bitcoin has increased in past few months and more after announcement of demonitisation for bitcoin and leading bitcoin exchanges has seen many inquiries, downloads of their app and demand.
Sathvik Vishwanath, chief executive officer of another big Indian Bitcoin Exchange, said, “We have seen more than 250 merchants sign up during this month (for accepting Bitcoin) and this will push for higher adoption. Places where you can spend Bitcoin range from cafes, bus and air tickets, renting servers, buying discounted vouchers, mobile and DTH top-ups etc. Our recent integration with PayU also allows our users to be able to instantly buy Bitcoin at anytime from their credit/debit-card or net banking.”
Bitcoin has emerged and gaining ground in India. Price projection of it doubling in 2017 will come true r not that time will tell but sentiment has turned bullish and most analyst say price is just 25 per cent away from its all time peak of $1161 seen two years back and that will be easily achievable.
