Making India ready for virtual currency: An analysis

Virtual currency is digital money or electronic money which provides a mechanism to pay for the value over the internet. In today's world of technology, development of virtual currency was inevitable and that's the reason why bitcoins have become a big hit among the users in such a short span. Due to the advancement in the virtual world the bitcoin users are expected to increase and in the absence of any economic regulations can pose great threat to the economy. According to the Reserve Bank of India the virtual currency is a highly volatile currency and as it's not yet regulated by the RBI it can lead to tax evasions, money laundering, terror frauds, etc. In the absence of any regulations for the same the virtual currency is highly susceptible to risks like hacking, theft, malwares, frauds, transaction errors, inadequate disclosures and failure of wallet or exchange. On the basis of the above, this paper throws light on the use of the virtual currency in India, the risks involved in the usage, the legal position and the indispensable need of careful amendments required in statutes to regulate the virtual currency.