At a time, Narendra Modi government is proposing to bring out legislation regulating cryptocurrency, the Swadeshi Jagaran Manch (SJM), the premier forum intended to protect the economic interests of Indians, demanded to ban such private digital currency.
In a resolution adopted at it’s two-day national meet in Gwalior, it cautioned that “there is no underlying asset”, “issuer is not identifiable”, “recognition of cryptocurrency may lead to heavy speculation which may adversely impact financial markets” and “recognition may also result in money laundering and terror financing”.
SJM further detailed its objections to this digital currency, stating: First of all, it’s a wrong notion that cryptocurrency is a currency. Currency means an instrument issued by the central bank and guaranteed by the government. Cryptocurrencies are privately issued virtual coins that have no legal recognition.
Secondly, crypto is being used by criminals, terrorists, smugglers and persons involved in hawala. Thirdly, …it is a valuable virtual asset …known to its holder only. Authorities will come to know only when it is transacted through a bank.
Cryptocurrencies may be taxed when a transaction is declared. But, SJM said that if it is sold abroad and not in the country, then it will not be taxed. In fact, crypto is not a fiat asset, it cannot be shown in the balance sheet of a company or an individual.
That is, crypto is becoming a medium for evasion of income tax, GST and many other types of taxes. There is yet another problem that it’s the most convenient method to transfer capital from a country bypassing rules, it added.
SJM said persons holding cryptocurrencies may be allowed to sell or exchange the same within a short period, subject to the provision of submitting the information to the income tax department. It has also asked the government to create awareness and to come up with a law for the issuance of digital currency by the RBI.
SJM said that an estimated 20 million people around the world have put their money in cryptocurrencies. Most of these are youth because they feel that they can get quick profit by putting their money in it, said the SJM. Moreover, it said that blockchain technology should not be linked to cryptocurrencies only and the use of this technology in all spheres of economic or social activities must be encouraged.
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Yes. For example, if you are depositing money in a bank… you will know the name of the bank, whether it is govt or private – if govt bank, you will be more comfortable… if private, you are less comfortable, but you MAY put your money in it, because you will see the bank, its branches, staff and you know in which cities the bank has branches, you can check its financials, etc…
Turning to this Bitcoin and other Cryptocurrencies, just notice this:
1. Name of the issuer – NOT KNOWN
2. Who are the shareholders – NOT KNOWN
3. Do they have any office anywhere in the world – NO, NO OFFICE AT ALL
4. Is there any phone number to get clarification or complaing – NOTHING – NO PHONE, NO CONTACTS.
5. Is this having an asset-base(like a company selling shares, making profit or loss etc… – NOTHING
6. So, where is the ownership of this whole show? – SOMEWHERE IN THE AIR, NO ONE KNOWS.
7. So, if suddenly my balance becomes zero or the Bitcoin/Crypto does not open up on computer, what should I do ? – JUST PRAY TO GOD, AND HOPE FOR THE BEST.
8. If I lose my money, on whom can I lodge my complaint ? – ON NO ONE…BECAUSE NO ONE KNOWS WHO THE OWNER OF THIS WHOLE SHOW IS.
9. Then how are people making money by investing on Bitcoin ? – DUE TO SOME OTHER PEOPLE LIKE YOU, WHO THINK IT WILL GIVE PROFITS, AND WILL BUY AT HIGHER PRICES.
10. Can the designer of the Bitcoin/Crypto withdraw all my money and disappear? – YES, POSSIBLE… HE CAN TAKE AWAY ALL THE MONEY…. HE NEED NOT DISAPPEAR, HE IS ALREADY IN THIN AIR, YOU DON’T KNOW THE OWNER ANYWAY.
11. Then, who are the people who are investing in Bitcoin/Cryptos? – PEOPLE WHO ARE EITHER SUPER RICH, OR WHO WANT TO TAKE A CHANCE WITH A LIMITED AMOUNT OF MONEY AND PREPARED TO LOSE IT, OR THOSE PEOPLE WHO DO NOT KNOW WHAT IT IS AND JUMP LOOKING AT OTHERS, OR PEOPLE WHO WANT TO BECOME RICH IN SHORT-CUT.
12. Will all these people become rich ? – MAY BE OR MAY BE NOT… IT IS TOTALLY DEPENDING ON CHANCE AND TIMING.
13. So, is this more dangerous than gambling ? – YES, CAN SAY SO – IN GAMBLING, AT LEAST YOU ARE ABLE TO SEE SOMETHING IN FRONT OF YOUR EYES…. HERE, NOTHING IS KNOWN.