During the present Winter Session of Parliament, Finance Minister Nirmala Sitharaman said that the government has no intentions to recognize Bitcoin as a currency. She further stated that governments worldwide have no idea how to control cryptocurrencies, including Bitcoin, which many see as a “speculative investment.”
The collapse of Lehman Brothers in 2008 wreaked havoc on the American economy, and its effect was felt throughout the world. The concept of virtual money and cryptocurrencies was born during this period. According to reports, Bitcoin has provided a 1 lakh-time return in the previous ten years, yet few people have any ‘know-how’ about digital currencies. Lockdowns have shattered the economy’s fundamentals, leading even more people to invest in Cryptocurrency.
Although bitcoin appears to be a profitable investment opportunity at first glance, the truth remains that cryptocurrencies are still illegal in India and most other major nations. As a result, the crypto industry is thriving in the dark web world.
Scammers and terrorists may find cryptocurrencies to be a safe form of trade. For example, in Karnataka, a hacker hacked out crores of rupees in a ‘Bitcoin’ fraud, allegedly involving several high-profile people. The hacker has been charged with both cybercrime and drug trafficking.
Crypto as the Asset
Not only in India but other nations as well, Bitcoin has elicited significant pros and cons reactions. Elon Musk is promoting cryptocurrencies. Warren Buffett, a billionaire investor, has stated that he will not spend a penny on it. Former Secretary of State Hillary Clinton has asked for the crypto market to be regulated, claiming that it poses a danger to traditional economies.
Global experts have raised misgivings about categorizing cryptocurrencies as an asset. In India, the crypto-mania has spread to tier-II cities, and the government’s sovereign power may be questioned due to its lack of control.
Exchequers in India have suffered a significant loss due to the non-imposition of GST in several tiers of Cryptocurrency transactions, along with no implementation of a penalty and income tax.