India is set to eradicate the use of cryptocurrencies it deems illegal, said on Thursday 1February Finance Minister Arun Jaitley.
</p>"The government does not consider cryptocurrencies to be legal tender or coin and will acceptall measures to ensure that they are not used in the financing of illegal activities or within the payment system," Jaitley told parliament in his annual budget speech.
However, the minister said the government will actively explore the use of blockchain technology to accelerate the move towards a digital economy.
The minister's announcement sparked panic selling of cryptocurrencies in India. It is likely that the current sharp decline in the price of bitcoin is, in part, provoked by these events.
Last month, Indian tax authoritiessaid they had sent notices to tens of thousands of people trading cryptocurrencies such as bitcoin after a nationwide study found the country saw more than $3.5 billion in transactions over a 17-month period. In December, the Ministry compared such investments to financial pyramids.
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