Cryptocurrencies are a threat to financial stability: Shaktikanta Das
The Hindu Business Line , Feb 13, 2018
Cryptocurrencies pose a major threat to the financial stability of the country, and Budget 2018-19 rightly sounded the voice of caution about them, Shaktikanta Das, Member, 15th Finance Commission, and former economic affairs and revenue secretary, said on Monday.
“Crypto currencies have the potential to become Ponzi schemes. I think the Finance Minister has sounded the voice of caution against them at the right time, and I am quite sure that the government will check the whole practice,” Das said in his keynote address at a Post Budget Talk organised by BusinessLine and SASTRA Deemed University, Powered by FICCI.
Das, who is also India’s Sherpa to the G-20, pointed out that in any country, under the statute it is the central bank (which, in India’s case, is the RBI) that is legally authorised to issue currencies for doing transactions on behalf of the sovereign.
“Suddenly, in recent years, because of some new technology, you have these crypto currencies coming up. The underlying asset is neither a promise of a central bank governor on behalf of the sovereign or the share of a company. Crypto currencies are born out of nothing,” Das said.
“The way crypto currencies are spreading, they can at some point pose a threat to global financial stability, and I think developed countries need to worry about them much more than anybody else,” he added.
In his Budget speech, Finance Minsiter Arun Jaitley had said that the government does not recognise crypto currencies as legal tender and would take all measures to eliminate the use of these cryptoassets in financing illegitimate activities or as part of the payment system.
Tax notices have reportedly been sent to about one lakh tax payers who have dealt in crypto currencies but have not included it in their income tax returns.
A nationwide survey showed more than $3.5 billion worth of transactions had been conducted over a 17-month period.