RBI looking into cryptocurrencies, 'not comfortable' with bitcoin

[webfact]

RBI looking into cryptocurrencies, 'not comfortable' with bitcoin

 

FILE PHOTO: A sign is seen in a restaurant where a Bitcoin ATM is located in Toronto, Ontario, Canada June 3, 2017. REUTERS/Chris Helgren/File Photo

 

MUMBAI (Reuters) - The Reserve Bank of India (RBI) has a group looking into cryptocurrencies as legal tender, a senior official said on Wednesday, but emphasised the central bank's discomfort with bitcoin which has recently come under intense global regulatory scrutiny.

 

"Fiat will be when the Reserve Bank, for example, starts issuing digital currency which you can carry in cyberspace, you don't have physical currency in your pocket," Sudarshan Sen, an RBI executive director, said at a FinTech conference in Mumbai.

 

"As regards non-fiat cryptocurrencies, I think, we are not comfortable with them," Sen added.

 

The central bank had not previously disclosed its plans on cryptocurrencies and Sen did not provide any details on where discussions on the issue stand.

 

It was unclear whether the group at the RBI plan to issue a recommendation on cryptocurrencies to the government, or if the review is at an early or advanced stage.

 

Bitcoin is a digital currency that enables individuals to transfer value to each other and pay for goods and services by-passing banks and the mainstream financial system.

 

Bitcoin slid 6.6 percent on Friday, after reports that China was about to shut down local crypto-currency exchanges. On Tuesday, Britain's Financial Conduct Authority (FCA) warned that initial coin offerings (ICOs), the practice of creating and selling digital currencies to finance start-up projects, are "very high risk" and speculative.

 

Jamie Dimon, chief executive of JPMorgan Chase & Co, also came out strongly against bitcoin this week dubbing it a "fraud", and adding that it will blow up. The virtual currency, not backed by any government, has more than quadrupled in value since December to more than $4,100.

 

(Reporting by Suvashree Dey Choudhury; Writing by Abhirup Roy; Editing by Shri Navaratnam)

 

-- © Copyright Reuters 2017-09-13

[12DrinkMore]

History repeating itself.

 

Tulip bulb mania in digital form.

 

At least tulip bulbs had some inherent value, like a flower. There is zero inherent value in bitcoin.

 

Once the rush to the exit starts, there will be no doors open.

[BuaBS]

12 hours ago, webfact said:

"As regards non-fiat cryptocurrencies, I think, we are not comfortable with them," Sen added

Of course they're not comfortable with it , governments/central banks hate competition for their toilet paper currency.

[rosst]

I now have more faith in crypto than Fiat, let us see what happens? 

[phycokiller]

On 9/13/2017 at 7:52 PM, 12DrinkMore said:

History repeating itself.

 

Tulip bulb mania in digital form.

 

At least tulip bulbs had some inherent value, like a flower. There is zero inherent value in bitcoin.

 

Once the rush to the exit starts, there will be no doors open.

the value of bitcoin is thats its the most efficient form of money invented so far. whoever uses it will have an advantage over those that dont

[12DrinkMore]

46 minutes ago, phycokiller said:

the value of bitcoin is thats its the most efficient form of money invented so far. whoever uses it will have an advantage over those that dont

 

1. Why is it the most efficient? 

 

2. What advantage does it give the users?

 

 

[phycokiller]

12 minutes ago, 12DrinkMore said:

 

1. Why is it the most efficient? 

 

2. What advantage does it give the users?

 

 

the potential of cryptos is cheaper transactions to anywhere instantly (admittedly bitcoin hasnt always done this but these no doubt that it or another crypto will in future, its still being developed, certainly for overseas transactions or large amounts its cheaper, overseas quicker). compared to cash you dont have to worry about those fake 1000b notes which are becoming increasingly common. convenience of doing transactions with your phone. not having to pay a bank to store and send your money. a few off the top of my head, theres no doubt others

[12DrinkMore]

51 minutes ago, phycokiller said:

the potential of cryptos is cheaper transactions to anywhere instantly (admittedly bitcoin hasnt always done this but these no doubt that it or another crypto will in future, its still being developed, certainly for overseas transactions or large amounts its cheaper, overseas quicker). compared to cash you dont have to worry about those fake 1000b notes which are becoming increasingly common. convenience of doing transactions with your phone. not having to pay a bank to store and send your money. a few off the top of my head, theres no doubt others

 

1. I do not find that banks are excessively slow, nor do I regularly make large overseas transactions that need to be instantaneous. At least with the banks I can find out where the money gets stuck. If it disappears on route with bitcoin, who do you call?

 

2. I do not worry about fake 1,000 Baht notes. And I don't think they are becoming more common just because it was on TV this week. I only heard of four cases. That is not common. A bigger worry with bitcoin is if the gateways close down and run off with your bitcoins. Or, if you store it on a memory stick, I would be in constant fear of the thing getting lost or breaking. AFAIK once gone it is gone. No means of recovery.

 

3. I do not pay banks to store money. They pay me interest.

 

4. I haven't used it yet, but payment by smartphone is possible and a lot of traders will accept it. So far, when walking around shopping centres I have not seen a single shop that will accept bitcoins, none of my colleagues use bitcoins. Only when I see large online retailers such as Lazada offering bitcoin payment systems will I consider that bitcoin is an acceptable medium of payment.

 

From what I have seen, most bitcoin owners only buy and hold, hoping that the value will keep on rising and they can sell for a profit later.

 

That is a tulip mania syndrome.

 

And has given rise to a considerable number of rival cryptos.

 

I still maintain that the whole thing will collapse at some point.

 

And with the huge amount of heat generated in bitcoin mining, it will certainly not gain the acceptance of the eco-crowd and the anti global warming movements.

 

[phycokiller]

5 hours ago, 12DrinkMore said:

 

1. I do not find that banks are excessively slow, nor do I regularly make large overseas transactions that need to be instantaneous. At least with the banks I can find out where the money gets stuck. If it disappears on route with bitcoin, who do you call?

 

2. I do not worry about fake 1,000 Baht notes. And I don't think they are becoming more common just because it was on TV this week. I only heard of four cases. That is not common. A bigger worry with bitcoin is if the gateways close down and run off with your bitcoins. Or, if you store it on a memory stick, I would be in constant fear of the thing getting lost or breaking. AFAIK once gone it is gone. No means of recovery.

 

3. I do not pay banks to store money. They pay me interest.

 

4. I haven't used it yet, but payment by smartphone is possible and a lot of traders will accept it. So far, when walking around shopping centres I have not seen a single shop that will accept bitcoins, none of my colleagues use bitcoins. Only when I see large online retailers such as Lazada offering bitcoin payment systems will I consider that bitcoin is an acceptable medium of payment.

 

From what I have seen, most bitcoin owners only buy and hold, hoping that the value will keep on rising and they can sell for a profit later.

 

That is a tulip mania syndrome.

 

And has given rise to a considerable number of rival cryptos.

 

I still maintain that the whole thing will collapse at some point.

 

And with the huge amount of heat generated in bitcoin mining, it will certainly not gain the acceptance of the eco-crowd and the anti global warming movements.

 

1. bitcoin doesnt get stuck, so you dont need to call anyone. you can be sure companies like microsoft, dell, virgin have thoroughly checked the coding and wouldnt be using it if they thought that was going to happen. millions of transactions and it hasnt happened.

2. gateways? exchanges? many are registered with the governments of the countries they are located in and are no more likely to run off with your money then any other business, and you would have legal recourse if they did. you can have backups of memory sticks, or use other methods.

3. true, you can also lend bitcoin for interest

4. sure, it has a long way to go before it gets to that stage, much of the public is still not aware of it. these things dont happen overnight

 

as far as tulip mania, in the case of bitcoin millions are spent every day on drugs alone, which was the basis of it original growth. some people find that unsavory but the point is its not pure speculation. there are a lot of online retailers accepting it too, many of them quite large, as I mentioned in 1. but certainly plenty of rival cryptos are pure speculation and will collapse and disappear.

[12DrinkMore]

17 hours ago, phycokiller said:

1. bitcoin doesnt get stuck, so you dont need to call anyone. you can be sure companies like microsoft, dell, virgin have thoroughly checked the coding and wouldnt be using it if they thought that was going to happen. millions of transactions and it hasnt happened.

2. gateways? exchanges? many are registered with the governments of the countries they are located in and are no more likely to run off with your money then any other business, and you would have legal recourse if they did. you can have backups of memory sticks, or use other methods.

3. true, you can also lend bitcoin for interest

4. sure, it has a long way to go before it gets to that stage, much of the public is still not aware of it. these things dont happen overnight

 

as far as tulip mania, in the case of bitcoin millions are spent every day on drugs alone, which was the basis of it original growth. some people find that unsavory but the point is its not pure speculation. there are a lot of online retailers accepting it too, many of them quite large, as I mentioned in 1. but certainly plenty of rival cryptos are pure speculation and will collapse and disappear.

 

Last time I looked the coding was done on Github with a bunch of OpenSource contributers, a community driven project. AFAIK Microsoft, Dell and Virgin are not involved in any official testing nor do they put their names and reputations on the line by endorsing it.

 

Anyway, here is the latest graph of Bitcoin. Nobody can run a decent business based on transactions in something that can have intraday moves of 20%.

 

 

 

Edited September 16, 2017 by 12DrinkMore

[phycokiller]

35 minutes ago, 12DrinkMore said:

 

Last time I looked the coding was done on Github with a bunch of OpenSource contributers, a community driven project. AFAIK Microsoft, Dell and Virgin are not involved in any official testing nor do they put their names and reputations on the line by endorsing it.

 

Anyway, here is the latest graph of Bitcoin. Nobody can run a decent business based on transactions in something that can have intraday moves of 20%.

 

 

 

can only speak for myself but I can assure you it is possible to run a very successful business using bitcoins. also, of course the reputations of companies that use bitcoin are on the line if their payment systems fail them, they are serious businesses with legal ramifications for failures, theres no doubt they had their coders check out the coding before accepting it as a payment system. they dont endorse it, they use it, and thats because their research says its beneficial for their businesses to do so.