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Police in the Northern Indian state of Jammu and Kasmir has issued a statement, warning the public not to invest in cryptocurrencies such as Bitcoin. The police are warning people against cryptocurrencies due to their “heightened risk” and the fact that they are not backed by legal tender or endorsed by the Indian government.
With cryptocurrencies becoming prominent in the media and more and more people taking the jump into experimenting with digital currency, we are seeing more governments commenting on crypto. The message has varied from nation to nation. When it comes down to it, cryptocurrency, like all emerging technology has its pros and cons, it has its potential and its teething problems, and people will focus more on one side than the other depending on what resonates with them.
The police in Jammu and Kashir are concerned about their residents investing in cryptocurrencies without understanding the risks, and potentially losing money if the cryptocurrency crashes. India is now the world’s sixth biggest economy and a major player on the world stage. However, India has always been fraught with issues surrounding fraud and corruption, something which the government is trying hard to tackle and to elevate India’s image. Cryptocurrencies have notoriously been used in scams, fraud and corruption schemes because of their untraceable and anonymous nature. It’s possible that the police are trying to distance themselves from anything that could be seen as high risk, in order to play it safe when it comes to the safety of the public and also the safety of their image.
It’s not all doom and gloom for cryptocurrency in India though. This story broke on January 2, and a day later a global financial body which includes India said that cryptocurrencies are not a threat. The Financial Stability Board (FSB) is a global inter governmental body that makes recommendations about the world ecomony, and includes over 20 members. Members include China, India, US, UK and more.
The following statement by the Reserve Bank of India (RBI) was issued:
”The FSB has undertaken a review of the financial stability risks posed by the rapid growth of crypto-assets. Its initial assessment is that crypto-assets do not pose risks to global financial stability currently.”
It seems as though India is on the fence about whether to adopt cyrptocurrency and join the arms race of other nations innovating blockchain technology, or to take a step back and see how it all plays out first.