The government on Tuesday said use of virtual currencies like Bitcoins is not authorised by the RBI and could result in breach of anti-money laundering provisions.The RBI had cautioned users, holders and traders of virtual currency, including Bitcoin, about the potential financial, legal and security risks arising from their usage.Why bitcoins are a bit risky “The absence of counter parties in usage of virtual currencies, including Bitcoins, for illicit and illegal activities in anonymous/pseudonymous systems could subject the users to unintentional breaches of anti-money laundering and combating the financing of terrorism laws,” Minister of State for Finance Arjun Ram Meghwal said in a written reply in the Rajya Sabha.‘Bitcoin adoption in India sees surge’ The creation of virtual currencies like Bitcoins as a medium of payments is not authorised by any central bank or monetary authority.“No regulatory approval, registration or authorisation is stated to have been obtained by the entities concerned for carrying on such activities,” he said.The RBI had warned that any user, holder, investor and trader dealing with virtual currencies would be doing so at his/her own risk.

List Your Business Find Service Near You MUMBAI: Despite the Reserve Bank's call for caution to people against the use of virtual currencies, a domestic Bitcoin exchange today said it is adding over 2,500 users a day and has reached five lakh downloads.bitcoin lazadaZebpay, an app-absed Bitcoin exchange, said it has had five lakh downloads on the Android operating system and is adding more than 2,500 users every day.ethereum ciscoThe company, launched in 2015, said, the increasing downloads highlight the "growing acceptance of Bitcoins as one of the most popular emerging asset class."litecoin block chartRBI WARNING OVER BITCOIN: RBI has been repeatedly flagging concerns on virtual currencies like Bitcoins, stating that they pose potential financial, legal, customer protection and security-related risks.litecoin 7 gpu

In recent cyber attacks, "ransomware'' hackers held victims hostage by encrypting their data and demanding them to send payments in bitcoins to regain access to their computers.bitcoin ltc chartBitcoin is a digital currency that allows people to buy goods and services and exchange money without involving banks, credit card issuers or other third parties.litecoin will riseBitcoin is not tied to a bank or government and allows users to spend money anonymously.litecoin not yet redeemedThe coins are created by users who 'mine' them by lending computing power to verify other users' transactions.bitcoin irc logsThey receive bitcoins in exchange.bitcoin asrock

The coins also can be bought and sold on exchanges with US dollars and other currencies.HOW MUCH IS IT WORTH?One bitcoin recently traded for $1,734.65, according to Coinbase, a company that helps users exchange bitcoins.That makes it more valuable than an ounce of gold, which trades at less than $1,230.The value of bitcoins can swing sharply, though.A year ago, one was worth $457.04, which means that it's nearly quadrupled in the last 12 months.But its price doesn't always go up.A bitcoin's value plunged by 23 per cent against the dollar in just a week in January.It fell by the same amount again in 10 days during March.WHY ARE BITCOINS POPULAR?Bitcoins are basically lines of computer code that are digitally signed each time they travel from one owner to the next.Transactions can be made anonymously, making the currency popular with libertarians as well as tech enthusiasts, speculators and criminals.IS IT REALLY ANONYMOUS?Yes, to a point.Transactions and accounts can be traced, but the account owners aren't necessarily known.

However, investigators might be able to track down the owners when bitcoins are converted to regular currency.For now, the three accounts tied to the ransomware attack appear untouched -- and it'll be difficult for perpetrators to cash in anytime soon without getting traced.WHO IS USING BITCOIN?Some businesses have jumped on the bitcoin bandwagon amid a flurry of media coverage. accepts payments in bitcoin, for example.The currency has become popular enough that more than 300,000 daily transactions have been occurring recently, according to bitcoin wallet site blockchain.info.A year ago, activity was closer to 230,000 transactions per day.HOW ARE BITCOINS KEPT SECURE?The bitcoin network works by harnessing individuals' greed for the collective good.A network of tech-savvy users called miners keep the system honest by pouring their computing power into a blockchain, a global running tally of every bitcoin transaction.The blockchain prevents rogues from spending the same bitcoin twice, and the miners are rewarded for their efforts by being gifted with the occasional bitcoin.

As long as miners keep the blockchain secure, counterfeiting shouldn't be an issue.HOW BITCOIN CAME TO BE?Bitcoin was launched in 2009 by a person or group of people operating under the name Satoshi Nakamoto.Bitcoin was then adopted by a small clutch of enthusiasts.Nakamoto dropped off the map as bitcoin began to attract widespread attention.But proponents say that doesn't matter: The currency obeys its own internal logic.An Australian entrepreneur last year stepped forward and claimed to be the founder of bitcoin, only to say days later that he did not 'have the courage' to publish proof that he is.The increased traction gained by Bitcoin in India as a result of the recent events including demonetization has caused the Reserve Bank of India (RBI) to issue a warning against the use of digital currencies, particularly Bitcoin.The press release issued on Wednesday by Chief General Manager Jose J. Kattoor cautioned the holders of digital currencies against the potential security and customer protection related risks.

The RBI’s public release available on their website states: “The Reserve Bank of India advises that it has not given any licence / authorisation to any entity / company to operate such schemes or deal with Bitcoin or any virtual currency.As such, any user, holder, investor, trader, etc. dealing with Virtual Currencies will be doing so at their own risk.” The statement reiterated the fact that the RBI has not given any authorization or license to any entity dealing with Bitcoin or any other virtual currencies.It also raised concerns over the legal status of Bitcoin exchange platforms.Further, it cautioned the users about the absence of any established framework of customer grievances redressal.This is not the first time that the RBI has taken upon itself to caution the people against virtual currencies.It had released another circular back in 2013, warning the adopters and traders of virtual currencies of any potential legal, operational and consumer protection risks.The possibility of digital wallet compromises due to hacking, malware-led attacks etc, and “huge volatility in the value of VCs” had been cited as the main reasons for the warning in 2013.