The former economic affairs secretary said it was right on the part of the government to voice caution about virtual currency in Budget proposals of 2018-19.
Cryptocurrencies have the potential to be like ponzi schemes and they pose a threat to the financial stability of the country, said former economic affairs secretary Shaktikanta Das.
Therefore, it was right, as per him, on the part of the government to voice caution about virtual currency in Budget proposals of 2018-19.
Das is a member of the 15th Finance Commission and also India’s Sherpa at the G-20.
The former economic affairs secretary said in his keynote address at a Post-Budget Talk organised by BusinessLine and SASTRA Deemed University, powered by Ficci.
“Cryptocurrencies have the potential to become Ponzi schemes. I think the Finance Minister has sounded the voice of caution against them at the right time, and I am quite sure that the government will check the whole practice,” Das was quoted as saying.
He said the central bank of any country worlwide is legally authorised to issue currencies for doing transactions and cryptocurrencies are born out of nothing.
“The way cryptocurrencies are spreading, they can at some point pose a threat to global financial stability, and I think developed countries need to worry about them much more than anybody else,”
Reserve Bank of India, in a press release in December last year, cautioned the users, holders and traders of virtual currencies (VCs), including bitcoins, about the potential financial, operational, legal, customer protection and security related risks that they are exposing themselves to.
Arun Jaitley, in his Budget speech, said the government does not consider cryptocurrencies as legal tender or coin and will take all measures to eliminate use of these crypto-assets in financing illegitimate activities or as part of the payment system. However, the government will explore use of blockchain technology proactively for ushering in digital economy, the minister said.
Recently, Sebi chairman Ajay Tyagi called upon the government to come out with regulation on cryptocurrencies without much delay.
Source: Media reports, Businessline