The government of India has been characterized by its position against cryptographic currencies like Bitcoin, while favoring the development and adoption of distributed accounting technologies. This position has been maintained over time with strong recrudescence periods, in which the authorities recommend that citizens not invest in cryptocurrencies. This week the Ministry of Finance of India again alerted the nation about the danger of digital currencies , which are not backed by the State and could be a new pyramid scheme.

The Ministry of Finance stated in a press release  that cryptocurrencies have no intrinsic value, nor are they backed by any asset or authority ; therefore they consider that the value of the same is due to a mere speculation.
The State points out, in turn, that this speculative system generates a high volatility in the price of these new technological solutions, as well as a high risk that the cryptocurrencies are dealing with a financial bubble. In this sense, the ministry argued that the digital currencies could be a typical Ponzi scheme, thus being vulnerable to the collapse of their profits and the loss of money, a situation that exposes directly to retail investors.
There is a real and high risk of an investment bubble of the kind seen in the Ponzi schemes that can cause a sudden and prolonged crash that exposes investors, especially retail consumers, to losing their hard earned money. Consumers should be alert and extremely cautious to avoid getting caught up in such Ponzi schemes.
Ministry of Finance of India
Likewise, the authorities warned that cryptographic currencies can be vulnerable to hacking, loss of passwords and malicious attacks due to their digital format. However, the Indian government would be falling into an inaccuracy with this statement, because hacking vulnerabilities would only be possible if the funds remain in exchange houses; If the users keep their money in their wallets, it is highly unlikely that they will be stolen remotely, because, until now, the blockchain has not been hacked. It would also be false to say that Bitcoin operates like a Ponzi scheme because there is no central entity that is profiting and redistributing the profits of the new participants.
The government also affirms that thanks to its cryptographic nature, they can serve as a bridge to carry out illicit activities, such as terrorism, smuggling, drug trafficking and money laundering.
The statement stressed that none of these financial tools are backed by the government, nor are they considered legal tender money or coins. It is because of this that the Indian government has not authorized any venture capital or company to devote to the exchange of rupees for cryptographic currencies, a scenario that certifies that the exchange houses in the territory work without a license.
This is not the first time that the government of India has made a declaration of this kind to alert its population of the possible investment risks involved in Bitcoin . For example, the Reserve Bank of India (RBI) has already warned on three occasions that it has not granted any national licenseto operate any of these cryptographic schemes.
Likewise, no other regulatory authority has offered legal protection to users and merchants of these digital currencies, a fact that reaffirms that the government of India is not interested in becoming involved with this market and recommends its citizens to avoid participating in said currencies. communities.
On other occasions, government agencies in India have also spoken out about the possibility of starting to discuss the legal status of Bitcoin in the territory, although the position of the State has always been pro-blockchain and against cryptocurrencies. These initiatives have borne fruit to the consideration of applying taxes to cryptocurrencies , alerts for the proliferation of  Initial Offers of Currency , regulatory projects  from the legal base and the development of a national cryptocurrency .

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