Cryptocurrency Could Be Big Ponzi Scheme, Warns India’s Finance Minister

India’s finance ministry cautioned the country’s investors against investing or trading in Bitcoin and other cryptocurrency, saying that they are just elaborate Ponzi schemes. This danger exists in large part because grasping even the basics of Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned). In this sense, blockchain is immune to the manipulation of data, making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tamp Read this Term technology remains daunting for non-specialists, it said.

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In a statement issued today, the Indian finance minister stated: “There is a real and heightened risk of investment bubble of the type seen in ‎Ponzi schemes, which can result in sudden and prolonged crash and result ‎in retail consumers losing their hard-earned money. Consumers need to be ‎alert and extremely cautious as to avoid getting trapped in such Ponzi ‎schemes.‎”

He added that Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term aren’t ‘legal tender’ and they don’t have government authorisation.

India’s finance minister recently appointed a dedicated panel that was tasked with examining the existing framework of cryptocurrencies and to come up with measures for dealing with the digital assets. The government-appointed panel was given three months to submit its reports on issues relating to consumer protection and money laundering.

The panel has still to decide on how the government can consider bringing in legislation to stop crypto transactions and which body will have regulatory oversight over cryptocurrencies.

Another government committee has recommended that India’s authorities take immediate steps to shut down the country’s cryptocurrency exchanges, saying that the use of Bitcoin and the like could result in a breach of anti-money laundering provisions.

Participants in India’s bitcoin market expressed their disappointment as they were hoping for some form of a legislation to regulate the activities of local exchanges.