Despite the Reserve Bank’s call for caution to people against the use of virtual currencies, a domestic Bitcoin exchange said it is adding over 2,500 users a day and has reached five lakh downloads. RBI has been repeatedly flagging concerns on virtual currencies like Bitcoins, stating that they pose potential financial, legal, customer protection and security-related risks.  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 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. 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. 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.

(Economic Times)