Indian Police Warn Public Against Investing in Cryptocurrencies

The police of the Indian state of Jammu and Kashmir have issued a public statement, warning the public against investing in cryptocurrencies, local business news daily the Business Standard reported on Jan. 2.

Police reportedly warned the public against the “heightened risk” of investments like Bitcoin (BTC) and reminded investors that cryptocurrencies are not sanctioned by the government. The Business Standard quoted the branch’s inspector general as saying:

"The general public is informed not to make any type of investment in cryptocurrencies, virtual currencies such as Bitcoin because there is a real and heightened risk associated with them."

The inspector general further stated that the crypto market could experience a “sudden and prolonged crash, exposing investors; especially retail consumers who stand to lose their hard-earned money.”

India currently enforces a ban on banks servicing cryptocurrency-related operations following a circular issued by the Reserve Bank of India (RBI).  The hard line against digital assets has led to the exit of several local businesses and a challenge in the Indian Supreme Court.

Earlier this week, Pon Radhakrishnan, the Minister of State in the Ministry of Finance and Ministry of Shipping, said that the government is approaching cryptocurrency regulation with caution. Radhakrishnan said that the lack of a “globally acceptable solution” meant lawmakers were unlikely to issue formal statutes in the short term.

Yesterday, the RBI announced that it has postponed plans to develop a national cryptocurrency or “crypto-rupee.” India’s central bank originally announced it was considering a central bank digital currency (CBDC) in April 2018, going so far as to establish an interdepartmental group to investigate the potential advantages of a CBDC.

The findings of the group have not been disclosed, and the Hindu Business Line quotes an unidentified source as saying, “The government doesn’t want the digital currency any more. It thinks it is too early to even think about a digital currency.”