India remains one of the countries in the world with regulatory uncertainty when it comes to cryptocurrencies. While the Reserve Bank of India (RBI) has already clarified that digital assets are not illegal in the country, the Police department of Tamil Nadu has issued a fresh warning that the public should steer clear of cryptocurrencies.
Trade Cryptocurrency At “Your Own Risk”
According to local news media, the Hindu, the Economic Offences Wing noted that they had received several complaints from investors who were scammed through cryptocurrency investments.
While the perpetrators of the registered cases were arrested, the police authority is now advising the public to avoid dealing with cryptocurrencies, including Bitcoin, Ether, XRP, and others. As per the warning, those who continue to invest in cryptos would have themselves to blame, considering that India’s central bank has not yet given the go-ahead to companies to offer cryptocurrency-related products or services.
“Those trading in virtual currencies were doing so at their own risk, given that the Central bank has not given a license or authorization to any company to deal in such cryptocurrencies,” the special unit of police said.
Cryptocurrencies Are Like Gold
The police further explained that cryptocurrency is not a currency according to the definition of money in the country, nor is it financial security.
Cryptocurrency has the same characteristics as gold and other precious metals as they behave like assets. A sovereign guarantee does not back them, thus they are not considered as legal tender, the police said.
Also, the cryptocurrency market is mostly unregulated, which exposes investors to high risks, unlike other investment vehicles. For this reason, investors have no official body that can address their grievances if they lose their investments in cryptocurrencies.
Bitcoin And Cryptos Are Not Illegal In India
With so many uncertainties going around in the India crypto space, the RBI issued a statement last month to clarify the stance of cryptocurrencies in the country.
As reported by Cryptopotato, the country’s central bank noted it has not banned bitcoin in the country but has only restricted banks and financial institutions from providing services to anyone dealing with cryptocurrencies due to the speculative and volatile nature of digital assets.
The RBI’s statement came as a response to a legal case filed by the Internet and Mobile Association of India (IAMAI). The association insisted that the Central Bank’s directive that forbids banks from dealing with crypto businesses was harsh since cryptocurrency trading was not legally prohibited in the country.