Government to curb cryptocurrency use

But India says it will explore use of blockchain technology proactively to usher in digital economy

India’s government said it doesn’t consider cryptocurrencies as legal tender and will take all measures to eliminate payments using them.

“The government does not consider cryptocurrencies legal tender or coin and will take all measures to eliminate use of these crypto-assets in financing illegitimate activities or as part of the payment system,” Finance Minister Arun Jaitley told lawmakers in New Delhi yesterday. “The government will explore use of blockchain technology proactively for ushering in the digital economy.”

Since reaching a peak of almost $20,000 in early December after the introduction of futures contracts on regulated exchanges in the US, a series of negative news has buffeted Bitcoin and rival cryptocurrencies, with losses intensifying since the start of 2018. Bitcoin’s January slide knocked $44.2 billion off the $200 billion in market value generated in all of 2017, the biggest one-month loss in dollar terms in the short history of digital assets.

The South Asian nation’s income tax officials had started investigations into transactions at various illegal Bitcoin exchanges in December, soon after the country’s central bank cautioned users about potential risks. The federal government had also set up a panel to decide on India’s stand on virtual currencies, sources said.

China — home to the world’s biggest community of Bitcoin miners — is also cracking down on cryptocurrency activity.