1. Blockchain Technology & Cryptocurrency
Plenary 8
Blockchain Technology & Cryptocurrency
April 28, 2018
IFA, New Delhi

2. BLOCK CHAIN TECHNOLOGY-CRYPTOCURRENCY
Chairman :
Mukesh Butani , Advocate
Moderator:
Kuntal Dave, Nanubhai Desai & Co.
Panelist:
Sonia Mathur, Sr. Advocate
Shikha Mehra, Global Jindal
Meyyappan Nagappan, Nishith Desai & Associates
Place : The Lalit, New Delhi Date : 28th April, 2018 Time : 03:45 PM – 05:00 PM

3. Contents What is Blockchain Technology & Cryptocurrency?
Existing Width and coverage of Crypto Currencies.
Recent Global Developments.
Regulatory and Tax treatment outside of India.
India’s Position – Regulatory Framework.
Short Term Challenges at India.
Long Term Impact of Blockchain.
28/04/2018

4. What is Blockchain technology & Cryptocurrency?
How Internet of Things is going to change how we do business:
Insurance Business
Retail
HR Management
Agriculture (supply chains)
Business-Process Management
Stock Balance Inventory
Tourism
Health Care
Transport and Car Industry
Energy Industry
Manufacturing
More Data (and faster)
28/04/2018

5. What is Blockchain technology & Cryptocurrency? Cont’d
Introduction to Cryptocurrency – Blockchain:
Blockchain – A decentralized, trustless ledger (list of transactions), on which only additions can be made
• The ledger history can never be changed
• All computers on the blockchain have the ledger
Cryptocurrency – A virtual currency that uses encryption to prevent “double spending”
28/04/2018

6. What is Blockchain technology & Cryptocurrency? Cont’d
The goal of Blockchain is to:
Make each digital asset identifiably unique(through cryptography),
Create a record that is trusted (a ledger),
Without a central issuer (decentralized),
And form consensus among computers of which transactions are valid.
P2P computer nodes
28/04/2018

7. What is Blockchain technology & Cryptocurrency? Cont’d
Transaction in a Blockchain:
28/04/2018

8. What is Blockchain technology & Cryptocurrency? Cont’d
Cryptocurrency – Market Perspective:
28/04/2018

9. What is Blockchain technology & Cryptocurrency? Cont’d
Cryptocurrency – Market Perspective:
28/04/2018

10. Recent Global Developments
Source:queenwiki.com
28/04/2018

11. Recent Global Developments Cont’d
Major Events – Q1 Global Overview:
Source:News.Bitcoin|Techcrunch|CNBC|NewsBTC|BBC
28/04/2018

12. Recent Global Developments Cont’d
Major Events – Key Regulatory Headlines:
28/04/2018

13. Recent Global Developments Cont’d
Tax Implications Worldwide:
Outlawed Bitcoins in early February 2018.
RUSSIA
Trading in Cryptocurrencies illegal.
VIETNAM
Tax enforcement consequences of digital currency.
SWEDEN
No guidance has been issued to Taxpayers completing transactions in Cryptocurrency.
SWITZERLAND
Has remained curiously mum so far on the subject.
AMERICA
Standard Tax Rules will apply to emerging Tax payment systems (Cryptocurrency).
On 3rd April it Launched new Cryptocurrency Exchange Regulations.
AUSTRALIA
Existing tax rules apply to digital currency transactions.
CANADA
28/04/2018

14. Recent Global Developments Cont’d
Tax Implications Worldwide:
Profits from trading in Bitcoin are liable to tax, just like profits from other assets.
NORWAY
At present it has no legislation directly regulating bitcoins and other virtual currency.
HONG KONG
As of 2017, Bank of Thailand is open to bitcoin provided proper controls are in place.
THAILAND
Profits & losses on Cryptocurrency are subject to capital Gain tax.
UNITED KINGDOM
In 2017 the Country’s Government officially recognized bitcoin and digital currency as a method of payment.
JAPAN
Businesses that deal with bitcoin currency exchange will be taxed based on their bitcoin sales.
SINGAPORE
While not illegal in the country Korean Authorities will prosecute illegal activities involving Bitcoin.
SOUTH KOREA
28/04/2018

15. India’s Position – Regulatory Framework
RBI has banned Regulated Entities From Dealing In Virtual Currencies
Reserve Bank of India wants its own digital currency
The Finance Minister stated in Budget 2018 that Cryptocurrencies are not valid tender
Cryptocurrency Investors were Sent Tax Notices by I-T Department
28/04/2018

16. Short Term Challenges at India?
Key Concerns
Unique Identifiers
Data Privacy Confidentiality
Integration with existing System
FEMA
Is it a ‘Currency’/ ‘Foreign Currency’?
Transaction of Bitcoin - Current Account Transaction?
Taxation
Gain from Sale of Bitcoin – Capital Gain or Business Income? Computation?
Earned during ‘Mining Process’ – Taxable?
Loss of ‘Bitcoin’ – Business Loss?
Situs of Bitcoin? Significance of ‘Online Wallet’?
General
Is it Legal in India?
Impact of ban of Cryptocurrency by Government of India?
Is it Goods or Service?
Is it a Prepaid Instrument?
Is it Payment for Import?
28/04/2018

17. Long Term Challenges of Blockchain
How can Blockchain address Transfer Pricing Issues?
How can Blockchain address the issue of Transparency and Beneficial Ownership?
Impact of Blockchain on the disputes and Litigation?
28/04/2018

18. Q & A
28/04/2018

19. Intellectual Property Financial transaction
Closing Remarks.
Influence of Blockchain on Litigation:
Possibility of using smart contracts with the use of blockchain, which will do away with traditional requirements of legal agreements.
Smart Contracts
With the use of IP artist and musicians can get better income and recognition.
Intellectual Property
Need for Lawyers specializing in Blockchain Laws/Digital Laws.
Blockchain Law
Lesser dispute in property related cases with the use of distributed ledgers.
Property Rights
Easily track the custody of documents with the use of digital ledger.
Chain of Custody
More challengers for lawyers to track anonymous payments through Cryptocurrency by criminals.
Financial transaction
Save space by using blockchain technology to preserve the notary documents digitally.
Notary Public
28/04/2018

20. THANK YOU!
28/04/2018