Is Crypto Trading Legal in India?
46sDirectly addresses a common and controversial question with a clear, actionable answer about legal gray areas and FIU-registered platforms.
▶ Play Clip"Delivers on the promise of a beginner's guide with practical examples, though it includes promotional content for Delta Exchange."
This video is a beginner-friendly guide to crypto trading in India, hosted by a trader answering questions from a viewer named Shubham. It covers the legality of crypto trading, the tax advantages of trading futures over direct coins, the concept of leverage and lot sizes, and a practical trading strategy using the fair value gap concept on the Delta Exchange platform.
There is no explicit law in India stating that crypto trading is legal, creating a grey area. However, it is not explicitly illegal either, so it can be done. It is recommended to trade through FIU-registered platforms like Delta Exchange to avoid legal issues.
In India, trading direct crypto coins incurs a 30% tax on profits, and losses cannot be set off against profits. Trading crypto futures avoids this tax obligation, offers 24/7 trading, and provides leverage up to 200x, making it a better option for Indian traders.
Leverage allows trading with more capital than invested. For example, with ₹8,500, at 1x leverage you can't buy even one lot, but at 10x you can buy 9 lots, at 50x about 42 lots, and at 200x up to 150 lots. Higher leverage amplifies both profits and losses.
The host advises against using 200x or 100x leverage, especially for beginners. For those with small capital, up to 50x is possible but risky. The recommended leverage is 25x, which balances risk and reward, allowing you to buy 22 lots with ₹10,000.
With 25x leverage, a 1% move in Bitcoin results in a 25% profit on your capital. However, the maximum loss is limited to your invested amount. Liquidation occurs when the price moves against you to a certain level, automatically closing your trade. Higher leverage brings liquidation price closer.
Crypto futures have standardized lot sizes, similar to stock options. For Bitcoin, one lot is 0.01 BTC, meaning 100 lots equal 1 BTC. This allows trading with small capital. Ethereum's lot size is 0.01 ETH, and other coins have similar structures.
It's best to trade in the top three cryptocurrencies by volume: Bitcoin, Ethereum, and Solana. These have high liquidity, resulting in tighter spreads and better execution. Bitcoin is more stable, while Solana offers quicker movements. Other coins may have low volume and high spreads.
You can start with as little as ₹100, but for meaningful profits, a capital of ₹20,000 to ₹25,000 is recommended for proper risk management. The host suggests using the fair value gap strategy from their previous videos, which involves identifying gaps in price and trading in the direction of the trend.
For crypto, it's better to trade on the 1-hour time frame rather than 5 or 15 minutes, as it provides more reliable signals. Beginners should stick to higher time frames until they gain confidence.
Before trading, analyze the daily chart to determine the long-term trend. If the market is in an uptrend, look for buying opportunities on the 1-hour chart. Confirm the trend with indicators like the 50 EMA.
Identify a large green candle, then draw a rectangle from the high of the previous candle to the low of the following candle. This forms a fair value gap. When price returns to this zone, take a buy position with a stop loss below the rectangle and target recent highs. This strategy can yield a 1:3 risk-reward ratio.
The video provides a comprehensive introduction to crypto trading for beginners in India, emphasizing the benefits of futures over direct coins, the importance of using leverage wisely, and a practical strategy based on fair value gaps. It encourages starting with a modest capital and focusing on high-volume cryptocurrencies.
Is crypto trading legal in India?
There is no explicit law making it legal or illegal, so it's a grey area. It is recommended to use FIU-registered platforms.
00:17
What is the tax rate on profits from direct crypto coin trading in India?
30% tax is levied on profits, and losses cannot be set off against profits.
01:38
What is the recommended leverage for beginners?
25x leverage is recommended as it balances risk and reward.
04:46
What is the lot size for Bitcoin on Delta Exchange?
One lot is 0.01 BTC, so 100 lots equal 1 BTC.
09:45
Which cryptocurrencies are recommended for trading due to high volume?
Bitcoin, Ethereum, and Solana have the highest volume and tighter spreads.
11:54
What time frame is recommended for crypto trading?
The 1-hour time frame is recommended for beginners, as it provides more reliable signals.
15:38
What is a fair value gap?
It is a gap formed between the high of a large green candle and the low of the following candle, used as a potential entry zone.
18:19
Tax Advantage of Futures
Explains a key benefit of trading futures over direct coins in India, saving 30% tax.
01:24Leverage Risk Warning
Provides a clear warning about the dangers of high leverage, crucial for beginners.
04:20Profit Calculation Example
Demonstrates how leverage can turn a 1% price move into a 25% profit, illustrating the power of leverage.
05:13Fair Value Gap Strategy
Offers a concrete, actionable trading strategy that viewers can implement.
18:07[00:04] asking me some questions related to crypto trading. So I thought that you people might also have the same questions. So I said that whatever questions you have, ask them in front of the camera so that you people can also get help. So tell me Shubham whatever questions you have.
[00:17] So my first question is, is crypto trading legal or illegal? So look, there is no law in India that says that crypto that says that crypto trading is legal. That means there is a grey area here.
[00:31] So when something is not explicitly stated as illegal in India, it means you can do it. But here one thing you must keep in trading, it would be better to do crypto trading only through such a platform
[00:44] which is FIU registered in India. use, which even most people use today to trade futures in crypto, So if you trade crypto through Delta Exchange then you will
[00:57] not face any legal problem because it is FIU registered in India. , withdraw money and on top of that, being FIU registered gives you the confidence that nothing wrong will happen to you. So this is the platform
[01:10] through which you can trade. I do too. Even most people So the platform is also clear for you. So now tell me what other doubts do you have? trading then should I trade in crypto futures
[01:24] trade in coins directly? Look, if you lived outside India, I would tell you to trade directly in crypto coins, that would be the best option. But in India, if you trade directly in crypto coins, then you should
[01:38] know that 30% tax is levied in India. If you make a profit, you will have to pay a tax of 30%. Due to which most of your profits will be lost and if you incur a loss, it will not be set off against your profits.
[01:51] So you will get into unnecessary tax obligation. So, if you want to trade in crypto while living in India, then trading in crypto futures is the best option. And the advantage here is that if you are trading in crypto futures
[02:03] then there is no expiry here. So it is exactly like you are trading in a particular coin. You just don't get caught in that tax obligation. Secondly, if you trade only in crypto futures, then here you
[02:16] can trade 24*7. As you trade in cryptocurrencies. Thirdly, if you trade directly in crypto coins, then here you see an option. Look, there is an option of leverage in this. And
[02:31] in this you can see how much leverage you want to take, you can see leverage up to 200 times. So let's say we have chosen a leverage of 1x here. So we just put $13 into this account. Meaning it is around ₹8,500. The
[02:45] money will be around ₹9,000 only. So with this money I cannot buy even a single lot. So if you are working with less capital, then in crypto currency, if you buy even a few Bitcoins, even if there is a little movement in it by making it exactly 0.00, then
[03:00] you will not get any special benefit. But if you have trading knowledge , you can trade in the right way. You can do the analysis. You are ready to work hard. So here you can earn more money by taking more leverage. For
[03:12] example, if you take leverage of 10x, then see now that I was not able to buy even a single quantity. Now I can buy nine lots with leverage of 10x. Now what is this lot all about? I will explain that to you as well. So now instead of this,
[03:25] if I look at it now, I have taken leverage of 10 times. And how many lots can I buy investing all my capital which is ₹8500. But if I take 50x leverage instead, look here how many times the quantity I can buy. If
[03:41] not straight 43 43 then I will definitely buy 42. So, by investing all my money, if no one takes leverage, I am not able to buy even a single quantity, but if I take leverage up to 50 times, I am able to just for example, let me show you one more thing that here you get leverage up to 200
[03:55] times. So here you see that if I take leverage of 200 times then I am able to buy 150 lots. Meaning I can buy more quantity with less money. Now if I have purchased more quantity then
[04:07] what is the benefit? If the price increases, I will make a huge profit. But keep one more thing in mind that if the price falls then you may suffer huge losses. So this leverage, you have to use it in a very correct manner.
[04:20] ? See the right way to use lovage. According to me, you should not take leverage up to 200X. You don't have to take it even in the very rarest of rare cases. not have much trading knowledge, then 200x leverage is not for you.
[04:33] Even 100x leverage is not for you. If you have very little capital in the beginning then you do not have any choice. You can go up to 50X in verge. But that too would be very risky. Let me also tell you why it would be risky. So the
[04:46] correct leverage will be according to me. The one in which you do not have much risk would be 25x. This means you can take 25 times leverage without any tension. Now you will not be able to buy that much quantity with this. See, you are able to buy 22 lots here
[04:59] but where you were able to buy 150 lots. But if you suffer a loss here, it will Well, I need to know one thing. Yes. If I invest ₹10,000 here and take leverage up to 25x, then I have got a trade worth ₹5 lakh.
[05:13] If I am done. Ok. If I make a profit then it is good. If there is a loss, will I have to pay ₹5 lakh? See what actually happens? You have invested ₹10,000 and you are taking leverage up to 25 times, then
[05:26] you are absolutely right that in a way you are investing ₹5 lakh in the market. So now if you get even 1% increase in Bitcoin here, then what is 1% of ₹5 lakh ? ₹2500 then you will get a profit of ₹500 which is a
[05:42] profit of 25% on your capital of ₹10,000. That is why we have taken an average of 25 times, but if you incur a loss, then the maximum loss you can incur is only as much as the money you have invested. you might be thinking that brother, if the loss is only Rs 10,000 then I should take leverage of only 200 times.
[05:57] Why should I take 25x leverage? So there is a very important thing here. what is this liquidation? Let me show you practically. Here I am Ok? You should see this practically. Now if I place two lots of 22
[06:13] , then all of them will be finished just like that. So, here I have 10 lots for you to look at carefully. You will enjoy watching it. We are only paying $6 for 10 lots. If we say $6, then ₹300 is used here at the rate of ₹4400 ₹85.
[06:28] At Delta Exchange. The price does not fluctuate. So if you add ₹8500 you will see $100 there and if you ever withdraw $100, so there will be no fluctuation. So I was showing you an example.
[06:43] Look, I have placed 10 lots here and have taken leverage of 200 times. Now I will Now look, as soon as I say bye it will appear below. Maybe the scene will happen in 2 seconds. here we are taking a buy position. You can also take it for sale. So
[06:57] clicked on Buy, my orders have been submitted. Phil has also been done. So, here Phil has also been done. So, here I'll show you, look, this is our trade. Here we have done buy and in this you can see that we have invested only $6 very quickly
[07:10] and we are seeing a loss of $5. Now here's something to look at carefully. This liquidation price that you are seeing, what is the current mark price? $1,963 and the liquidation price here is 111,735. That
[07:24] means if Bitcoin falls even by 200 points here, then Bitcoin fluctuates by 44-4000 points in a day. If Bitcoin fluctuates by 44-4000 points in a day. If invested will be lost and at that time your trade will automatically exit
[07:38] because you have taken leverage. I have taken a leverage of 200 times. So that's why if you were show you that this estimated liquidation price would have been very far away. Meaning it would have been 4000, 5000, 6000 points away. So now
[07:52] if the price increases or even comes down a little, your liquidation will not be hit. You can also set a stop loss target. So, you should people exit the trade. Look, in this delay we lost $1.26.
[08:09] profit and it can fluctuate in a few minutes. So what do I do? I will exit this trade here. Ok? I have exited the market itself. And now let me show you another example. And
[08:22] in this example we are the same thing. Here we come. Now let's take leverage up to 25 times. Ok? Last time also we had taken 10 lots. This time also we take 10 lots. But this time note that we have to pay $46 to buy 10 lots. That means you have to
[08:37] pay more money. Because we are taking 25 times leverage. So what do I do now As soon as I clicked Buy , my order was submitted. Phil has I am showing you a live example. Look, you will understand from here. Now look
[08:52] Look, you will understand from here. Now look back the mark price is the same at 11,1875. ₹18,000. That means there is a difference of roughly Rs 4,500. So such 4,500 points will not come suddenly. This will happen in very rare cases. So here, even
[09:07] if the price falls by 1,000 points or 2,000 points, you will not suffer any loss. Even if it increases after that, you can still make profit. That is why you have to use this leverage very thoughtfully and that is why I told you that
[09:19] Ok? I have understood leverage. So I just want to know what is this lot size Look, if you buy in Direct Coins, then you can buy any quantity there. But if you want, you
[09:33] also option trading which takes place in the stock market. So there is a lot there is a lot size of Nifty. Bank Nifty has a lot size of 1. So similarly, if you trade in crypto futures, then here
[09:45] too they have a lot size. And let me show you that lot size. For example, one lot here, if we talk about Bitcoin, is 0.01 BTC. That means if you are buying one lot then you are buying one thousandth of a Bitcoin. Now
[09:59] buying one thousandth of a Bitcoin. Now if you buy 1000 Bitcoins then it will become one Bitcoin. Ok? Now Bitcoin you know is worth $11,000. So that you can trade even with less money. Therefore, here they have calculated one lot as
[10:12] Therefore, here they have calculated one lot as 0.01 BTC. Because if you had 1 BTC, you would need a lot of capital to take a trade. We click on futures. Now look here are all the
[10:27] can trade. You must be seeing it here. Here you can trade Bitcoin. You can trade Ethereum. You can trade Solana. Apart from this, Suppose you want to trade a particular meme coin.
[10:41] all these meme coins are visible. So you can see all types of crypto currencies. So the lot size of Bitcoin is 0.001. you can also see Ethereum here. The lot size of Ethereum is 0.01 Ethereum. That is,
[10:57] if I buy 100 Ethereum. If I buy 100 lots, it will be equal to one Ethereum. can trade Ethereum as well. Apart from this, I have already shown you that there are almost all the cryptocurrencies in which you can trade. By the way, let me tell you one more thing
[11:11] open your account to trade in Delta Exchange, then I have given You can open your account from there. And if you open your account using our link, then first of all
[11:25] filling out that form, you will be open your account in Delta Exchange through our link only.
[11:38] if I want to take a trade then which crypto currency should I choose for trading. Look, there are lots of crypto currencies here. You can trade in any of them if you want. volatile and have the highest volume.
[11:54] Ok? You can trade in Bitcoin. There is Ethereum. You can trade in Ethereum. You can trade in Solana. These are the top three. If you trade in these, the advantage is that there is a volume of 480 million here. There is a volume of 835 million
[12:07] Solana also has a volume of 378 million. Whereas in the rest, the volume is not that many people are buying and selling in it. So, you will see very high spreads. Meaning, the purchase was made at a price higher than the price at which you wanted to buy. Then
[12:22] want to sell it at some other price and it gets sold at some other price, then you will still incur a volume and you can see that more volume is there Apart from this, you are seeing decent volume in this also. But if we say, then
[12:35] we get to see the highest volume in these top three cryptocurrencies which are in these top three cryptocurrencies which are Bitcoin, Ethereum and Solana. So if you want something a little stable then you can go for Bitcoin. If you really need a
[12:47] quick burst of movement, then you can go for Solana. If you So these are the top three in which it will be better if you trade. Ok? I have understood all these things. So now I just want to know with
[13:00] how much money should I start trading me the complete process and also a strategy so that I can start at the basic beginner level. Ok? So look, first of all, if you want to start with ₹1000, ₹2000, ₹3000, then
[13:15] you can start with ₹100 also because you know that if you take the average of 200 times, then you can buy one lot of Bitcoin even for $24 or even for less than $1. you can buy one lot of Bitcoin even for $24 or even for less than $1.
[13:29] , see, then you can try it even with 100, 200 or $5000. But if you actually want to earn profit then you will have to carry some decent capital. So now what should be the minimum capital according to me? So look, I
[13:42] think you should have at least ₹20,000 to ₹25,000 if you want to start trading so that you can manage proper risk. Now as far as the strategy is concerned, I will show it to you in the chart itself. There are many strategies.
[13:54] We have already made a video on strategies. We have taught the smart money concept which is good through which you can make money and in that we have taught a concept of fair value gap. It is a very good topic. You can earn money only by learning that. So now let
[14:07] me open the chart here. So now first of all you have to open your account. We have already given you the link in the description. And let me tell you here that you is an app on mobile as well. We have to show you. So I am showing you the screen.
[14:20] But open your account only through the link given in the description. So what do you have to do after that? First of all you have to add funds. not have to take any trade straight away. If you trade like this you will never be able to make money. You will only cause loss,
[14:34] people to suffer. So what do you do after that ? First of all, do not get into options in the beginning. Here let me tell you about futures that the speciality of futures is that tell you about futures that the speciality of futures is that it is a perpetual future. For example, if
[14:47] an expiry and on the day of expiry the value of those options becomes zero. Futures also expire on that day. But this is perpetual. So first of all, there is no expiry here. So you said goodbye today. You can leave him for 2 months or 3
[15:00] you said goodbye today. You have to sell it today itself. You can keep it with you as long as you want. And secondly, unlike options, there is no theta attached to it decreasing. Even if the price increases after four days, you will still make a profit.
[15:14] So you don't have to worry about that either. So now when you come here you have told you that it would be better if you trade among the top three coins. What should you do? You choose Ethereum from here. After choosing Ethereum, you can
[15:26] open the chart in full screen. Opened it. Now see, the first thing your time frame. Now here you can see many time frames. If you used to
[15:38] trade in the time frame of 5 minutes, 15 minutes, then according to me, that was fine till the stock market. That's not all well in crypto. At least according to me, trade in one hour time frame and trade for several hours initially. If you gain
[15:52] or start earning money then you You can also take a little more. But all that is for when the confidence comes. For now, it would be better if you trade in the 1 hour time
[16:06] But what should you do first for that ? You can change the time frame here to one day. You tell me here, what do you think after looking at the chart, whether the , going down, what is happening? If I look from here from a long term
[16:19] perspective, then the market is going up here. But here it seems to be consolidating now. It could Ok? I understood. So here you can see that there is an up trend. There we can see a little bit that the market is falling. That is, we can say
[16:33] up trend. Apart from this, look, we have also placed a 50 EMA indicator here. So the price is even higher than that. So you can assume that the long term trend of the market is an know a little bit about the trend. So now I've told you where to trade
[16:47] Now as soon as I select the time frame of one hour. Now tell me what is the Here it seems that the market is going up at one price and then coming down. Then it is going up and then it is coming down. So that's why I saw you once before
[17:01] Looking at the one day time frame, we got some idea that its long term trend is upwards. But when we opened the one hour time frame, we could see that brother, the whole matter is going sideways here.
[17:15] look here, if you can see in the larger time frame that the market is going up. in the short time frame like we used the one hour time frame, it is also visible that Ethereum is going up. So here you can confirm that this is a high
[17:28] take a buy trade, better. Now what is there here? There is confusion because the larger time frame is in an uptrend. The shorter time frame is sideways here. So first of all, it would be better if you wait till it comes into uptrend.
[17:42] But I want to show you an example. So let me show you one more thing here. Look, right now, I'll show you an opportunity here. We have a video on our channel about fair value gap. I don't know whether you saw it or not. If
[17:55] you have seen it, please let us know by commenting. And if you haven't seen it, then watch it. There is a video on the smart money concept. There is a video above on the fair value gap. There is a video above the order block. There are many videos. Please do check it out. So apart from this we have taught a fair value gap
[18:07] strategy. According to the strategy, suppose you see the market going up and you see a fair value gap there. Now what is this fair value gap ? That if you see a big green colored
[18:19] seen here. This is a big green colored candle. Isn't it? So what do you have to do? You should let the next candle close. Now look, this is the next time frame. It's 1 hour. This market in 1 hour means the
[18:33] price of Ethereum was so big and it was here before that. So what do you have to do? When you see a big green colored candle.
[18:48] you will see an option here, click on it. After clicking on this, click here. You click on it and move it up. Ok? You caught the high of the previous candle and the
[19:01] low of the red colored candle that formed after it. Caught you. Look at this red candle next to it from here. You have to draw a line along this. Something like this. Ok? Ok? So we will say what is this? This
[19:15] is a fair value gap. So now if the price comes back near this level then there are is believed. So as soon as the price reaches here, you can take a buy position here. Your stop loss may be slightly below this. There is
[19:30] taught that in a separate video. So you can watch that video. So this is how you get a fair value gap from here. So now if you I am just showing you for example that a fair value gap has been formed.
[19:45] Otherwise, if we look at the long term, the market is moving sideways here. here I will take another example. In that example, I told you that the market was moving sideways, so it is not that effective. So look here,
[19:57] you can see a big green colored candle here. It is clearly visible. So you can see from the top that the uptend is also going on. The long term trend we have already seen is an up trend. So here you first saw in the one day time frame
[20:09] trend is going on. After that you can also see in the one hour time frame that the market is moving in an uptrend. And after that you also saw a big green colored candle here. So here you are triple confirmed that the trend is
[20:21] bullish. From above, we also see a bullish FPG forming. So now when you see this green colored candle, then let us assume that that these three candles have been formed. What will you do with this small candle? Now
[20:36] go back to the rectangle here. After this, drawn a rectangle here. Ok? Something like this. What have we done? Actually,
[20:51] as soon as we saw this big green colored candle, the first candle would have been high of the previous candle and the low of the candle after that, that is, this small green colored candle that you can see.
[21:05] what will happen next is that whenever the price comes near this level, what do we do stop loss will be a little below this rectangle, that is, the stop loss will be here. So you would have bought here and for the target if you
[21:19] see any recent high, that is brother, the high which was before this, if you look at the chart a little back then you will see that the high which was before this was almost here, so you can take it till here also or before this you are seeing some other high somewhere else.
[21:32] So right now we are only seeing this high in the recent. So you can aim for this much. Ok ? Now we don't know how much the price has increased further. So you saw that before this there was a recent high.
[21:45] So what did you do? You said bye here. Come back from back. Ok? What do I do here? Let me draw a line here so that you can understand. Ok? So what did we do? Draw a line here. So now let's come back
[22:00] and look here. What have you done? As you see here, the price in this red candle came inside it. Ok? So just like you made this red candle right n't know this price would come here. So as soon as the price came near this level, you
[22:15] and you targeted till here. So even though you did not catch such a big movement, you caught this much movement and if I calculate this also, I will show it to you. From here we calculate it. Look, you said goodbye here.
[22:29] Your stop loss is almost here and you are taking this much for the target. And you can see that you would have got the target of 1:3. You can get made a separate video on this strategy on Fair Value Gap. So you should
[22:43] Many examples have also been given. But before that you will have to learn some smart money concepts and candlestick patterns and all these things.
[22:59] it will become a video of several hours. So overall, I think your basic questions must have been you have any doubts left, please let me know. No, not at the moment. If you want us to make more videos like this, please let us
[23:13] in the description. You can open your account from there. If you And if you can watch this video. If you want to learn how to use this Delta Exchange
[23:29] , how to short, then we have made a detailed video on this also. You can also watch that video. You might be seeing that video here. Thank you.
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