While India has not officially adopted a position for or against virtual currencies the government and the Reserve Bank of India have periodically warned of the associated risks. with them. The RBI has now reiterated its warning against virtual currencies

Reiteration of the Risks Involved

In a press release, the Reserve Bank of India stated:

As a result of the significant surge in valuing a lot of venture capital and the rapid growth of initial coin offerings (RCO), RBI reiterates the concerns conveyed in press releases Previous

2013 and early 2017 have highlighted the risks associated with cryptocurrencies. He clarified that he gave no license / authorization to any entity to operate in the Bitcoin space and that the users were doing so at their own peril. He highlighted the economic, financial, operational, legal, customer protection and security risks associated with managing these virtual currencies.

India – A ripe ground for cryptocurrencies

India is considered ripe ground for cryptocurrencies in part because of its huge tech-savvy population. The subcontinent is also ripe for the adoption of digital currency due to the failure of the country's demonetization system and an inflation rate that has exceeded 10% twice in the last 10 years. India currently accounts for a very small portion of Bitcoin's trading volume, having been South Korea and Japan. Indians are the biggest consumers of gold in the world and the demand for Bitcoin, the digital gold, is currently increasing.

The Unclear Status of Bitcoin

The lack of regulation surrounding cryptocurrencies resulted in Court being asked to rule on the status of Bitcoin. While the government has taken the usual course of appointing a committee and waiting for it to submit its findings, business continues as usual for exchanges like Zebpay, Coinsecure and Unocoin

despite the warnings of RBI, unless the government clarifies ambiguous position, there will be a regulatory vacuum. Earlier this month, Indian Finance Minister Arun Jaitley said that virtual currencies do not have legal tender and said the government was evaluating the committee's recommendations put in place to consider the issue. The Indian government may be slow to respond, but Indians seem to like virtual currencies, as evidenced by the huge demand for Bitcoin for Indian trade and the substantial premium Bitcoin trades in India.