Cryptocurrencies like bitcoin have become a hot topic for the people of India, mostly in terms of investment. The online traded currency is believed to be valued more than NSE’s highest performing stocks; which has attracted numerous seasoned investors of India.
Cryptocurrency was a silver lining for many investors until recently when it was deemed illegal by the RBI. According to investment experts, Cryptocurrencies are a great avenue for substantial returns, but it’s no investment barrier brings it under speculation.
History of Cryptocurrency(Bitcoin):
Cryptocurrencies were first introduced in the year 2009 as ‘Bitcoin’.Initially,it was an open-source software but was later modified and introduced into trading. Due to its open source license, there are more than 4000 alternate version of Bitcoin operating worldwide.
Bitcoin was the first cryptocurrency to set foot in the Indian market with a price of USD 1000. It was soon followed by Ripple Cryptocurrency, Etherium and Dash, which also gained popularity among investors. It is no surprise that Indians also took advantage of its open source software, which led to Indian versions of Bitcoinsuch as Zebpay, Unocoin and BTCX India.
Why are Cryptocurrencies banned in India?
Owing to its progressive performance in one year, bitcoin attracted many potential investors in India. People are investing huge amounts of money and are expecting high returns from it. However, the RBI policy and SEBI policy on cryptocurrencies alert caution on cryptocurrency trading due to the following reasons. Firstly, bitcoin is a digitally operated virtual currency and tracing its operators is next to impossible which makes it prone to investment frauds.
Secondly, since it is stored in a digital form,the investors can lose their money to hacking, malware attacks or loss of credentials. Thirdly, bitcoin payments take place on a peer-to-peer basis as there is no regulatory body to monitor them. Hence, there is no way to resolve payment disputes, charge backs and customer problems.
The stock market has seen a huge influx of cryptocurrencies in the past year, which are operated by unknown entities. Hence, Prabhudas Lilladher highly recommends investing cautiously in cryptocurrency until they are regulated and brought under jurisdiction.