Possible risks in investing in ‘Virtual Currencies’, Government issues advisory
New Delhi, Dec 29 (KNN) Warning the stakeholders of the possible negative aspects of the popular virtual currencies in the country, the Finance Ministry issued an advisory recently.
The Ministry said that it has come into notice that in the recent times there has been a phenomenal increase in the price of Virtual ‘Currencies’ (VCs) including Bitcoin, in India and globally.
The VCs don’t have any intrinsic value and are not backed by any kind of assets. The price of Bitcoin and other VCs therefore is entirely a matter of mere speculation resulting in spurt and volatility in their prices, the statement said.
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 exposing investors, especially retail consumers losing their hard-earned money, finance Ministry warned.
The government notified that the consumers need to be alert and extremely cautious as to avoid getting trapped in such Ponzi schemes.
Hinting at possible threats with such schemes, the Ministry further said that such schemes being virtual, they are more vulnerable to hacking, loss of password, malware attack etc. which may also result in permanent loss of money. (With PIB Inputs) (KNN/DA)