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Bitcoin Not Legal Tender In India, Arun Jaitley Clarifies Risks Of Investing In Cryptocurrencies

AASTHA SINGAL | 0
1975
| } January 2 , 2018 , 19:20 IST

Cryptocurrencies like Bitcoin are not legal tender in India and the ones investing in such "in Ponzi schemes" are at the heightened risk of loss, Finance Minister Arun Jaitley on Tuesday clarified in Rajya Sabha after several members brought up their concerns.

Cautioning the investors about no security associated with these virtual currencies, the Finance Ministry stated, " There is a real and heightened risk of investment bubble of the type seen in Ponzi schemes which can result in sudden and prolonged crash exposing investors, especially retail consumers losing their hard-earned money."

He further added, "Consumers need to be alert and extremely cautious as to avoid getting trapped in such Ponzi schemes."

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Due to being stored on the digital platform, the virtual currencies are vulnerable to hacking, password theft, malware attacks among other risks which can lead to permanent loss of the investor's hard-earned money.

During the Rajya Sabha session, DMK member Kanimozhi asked the government about the respective steps taken to regulate the crypto-currencies such as bitcoin and ethereum, as India "accounts for more than 11 percent" of such trade globally. 

Re-iterating that Bitcoin is not legal in India, Arun Jaitley replied, "The government is examining the matter. A committee under the chairmanship of secretary, department of economic affairs, is deliberating over all issues related to cryptocurrencies to propose specific actions to be taken."