At this moment in time, one of the biggest misconceptions regarding bitcoin refers to the fact that it represents a digital currency meant to fund illegal activities. While there are numerous research studies carried out by analysts from all around the world, which have proven that only an insignificant percentage of bitcoin transactions are carried out for shady purposes, this trend of belief continues.
According to recent reports, Intelligence Agencies in India have just issued an official report stating that virtual currencies such as Bitcoin can be used for the funding of illegal activities, by people who also move their funds through hawala transactions. Once the report has been received by the competent authorities, the Indian Government alongside with the Reserve Bank of India, also known as RBI, have responded and said that they will investigate the issue and do their best in order to ensure that the bitcoin payment method is not used for illegal purposes.
In a recent press statement, a government official has declared that: "At present we have no mechanism to deal with such mediums. The expertise from RBI will be used to come with specific measures to tackle such issues". Another official has stated that: Specific inputs have been received that in some cases these virtual currencies were used for hawala transactions (...) As of now it is not illegal to buy or sell Bitcoin or any other currency because they are on peer to peer exchange platforms. We are not intending to stop it but ensure checks and balances in the system so that they are not misused".
Back in 2013, the RBI issued a press statement, cautioning people throughout the country about the potential risks of dealing with digital currency, and the lack of customer protection, and legal framework that would protect them in case anything goes wrong.
At this moment in time, the trading, creation and usage of digital currencies as method of payment are not authorized by any of the monetary authorities operating within India, but are not forbidden either.
Judging by the recent Government statement, there are chances that the legislative body will look into the idea of creating regulation, meant to have a bit of control of the digital currency activity in India. If this happens, it likely won't affect normal digital currency users, but rather bitcoin firms, such as Unocoin, which have raised massive sums of money from investments, and which are quickly expanding their services. In a way or another, it is understandable that the government will ask these companies to investigate shady transactions they facilitate, to ensure that the funds aren't used for illegal purposes.
Based on everything that has been outlined so far, what do you personally think about the report issued by the intelligence agencies in India? Let us know your thoughts in the comment section below.