Across the globe cryptocurrencies including bitcoins are under high surveillance owing to the massive rise in price merely driven by speculation and then a sharp fall which has incurred huge losses for investors.
Bitcoin fall in price, dominance and market cap
For instance, taking the example of bitcoins, it was trading at below USD 1000 at the start of last year and then peaked to levels as high as USD 20000 on some of the global exchanges in mid of December 2017 after the futures trading in it began. And since then it is on a declining spree and hit the worst week in performance last week since January 2015.
The largest currency in the crypto world tumbled down not only in price but also market cap and dominance. And it is slowing being taken over by other less familiar altcoins.
Cryptos compared to Ponzi Scheme and not a legal tender in India
In India too, the day is not far when we will see cryptocurrencies to form a part of mainstream investment option which is currently the interest of primarily tech-savvy crypto enthusiast who are ready to take dip in the highly volatile token. Still, a survey by IT dept reveals active trading in cryptos by 6 lakh Indians.
With no regulating agency and norms in place for cryptos in India currently, the government has raised red-flag and reiterated that traders in such digital currencies should engage in it at their own risk. Of late the government even compared it to a ponzi scheme.
Authorities fear use of black money in crypto trading post demonetisation
To ensure that clean money is being used for the purpose of trading in cryptos, government has now fast-tracked the process to come up with a law as though the virtual currency is not a legal tender in India, the same is not banned. And such that interest of investors and traders in these recently popular tokens is well protected, regulations per se exchanges that facilitate transactions in them have also to be put in place.
So, the commission comprising officials from the economic affairs, tax dept, ED and RBI formulated to work out a comprehensive law on cryptocurrencies including bitcoin is expected to table the regulations soon.