The Reserve Bank of India issued a statement on Friday comparing cryptocurrencies to ponzi scheme and warned people to stay away from virtual currencies such as bitcoin. RBI added that cryptocurrencies are not backed by regulations hence there is a real and heightened risk of investment.
The Minister also said that transactions of cryptocurrencies are encrypted and they are also likely being used to carry out illegal activities, such as, terror funding, smuggling, drug trafficking and other money-laundering Acts.
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