ok, so consider 2 options:-

1. you trade outside exchanges. you give your bank account number to a buyer and sell him bit coins. he *knows* your identity because you gave him a/c number. if the government decided to have a negative stance on bit coin, they would look for active bit coin buyers/sellers and get hold of them and then get other contacts out of them.

2. you trade inside exchange. you give them your identity for KYC.
if the government decided to have a negative stance on bit coin, they would raid exchanges and get your info and contact you.

which option is better?please give me your opinions.


and micky123, bit coin's nature is lost when you convert it to rupees. i am talking about bit coin traders(those who sell/buy bit coins and deal with *rupees*). so i was talking about taxation from a rupees perspective. obviously government can't tax bit coins. it is if i convert it to rupees that i should tell the government about it.