RBI keeping a close watch on cryptocurrencies: Urjit Patel tells Parliamentary panel

New Delhi: Reserve Bank of India (RBI) is keeping a close watch on transactions involving cryptocurrencies, governor Urjit Patel is understood to have told the members of the Parliamentary panel on finance on Wednesday. [caption id=“attachment_3731271” align=“alignleft” width=“380”]  Reuters[/caption] During the more than three-hour long meeting of the Standing Committee on Finance in New Delhi, the members raised concerns about rising number of transactions in various cryptocurrencies such as Bitcoin, Ethereum, Zcash, litecoin and NEM. They also wanted to know from the governor whether the use of cryptocurrencies is legally permitted, a member said. Members, including Bharatiya Janata Party (BJP) member of Parliament (MP) Nishikant Dubey, said rise in usage of virtual currencies is a matter of concern as it is difficult to establish the source of funds. Responding to the concerns raised, Patel told the members that the RBI is keeping a close watch on such transactions. He also told the panel that an inter-disciplinary committee has been formed to discuss the legality of cryptocurrencies, according to panel members who did not wish to be named. In April, the finance ministry constituted an inter-disciplinary committee to examine the existing framework for virtual currencies, including Bitcoins, and suggest measures to deal with issues like money laundering. Leaders from G20 countries, during their meeting last week, had discussed about the threat of cyptocurrencies being possibly used for terror financing.