Cryptocurrencies are a Clear Danger

There is growing cyber risk in the financial system, the threats include

· Ransomware – attackers encrypt an organisation's data and require payment to restore access.

· Cryptojacking – when cybercriminals secretly use a victim's computing power to generate cryptocurrency.

· Threats against data – data breaches/leaks.

· Social Hacking- “Employees are still falling victim to social attacks. ...

· Distributed denial of service (DDoS) Attacks are becoming very common and it seems there is no respite on the immediate effect.

The recent move by the Government to regulate the Virtual private network or VPN, is aimed at strengthening cyber security. Since, VPN services don't store logs of user activities and users usually use VPNs to hide their IP address from their Internet Service Providers and other third parties.

However, the tech companies are getting suffocated and addressing the industry by raising the issue of user privacy as VPNs are generally, which is used to conceal information.

Dubbing cryptocurrencies like Bitcoin and Ethereum as clear danger, the governor of Reserve Bank said, anything that derives value based on make believe, without any underlying, is just speculation under a sophisticated name.

RBI Governor Shaktikanta Das said this in the latest Financial Stability Report of India, even as the country’s government is in the process of finalising a consultation paper on cryptocurrencies after gathering inputs from various stakeholders and institutions. We must be mindful of the emerging risks on the horizon. Cryptocurrencies are a clear danger.

While technology has supported the reach of the financial sector and its benefits must be fully harnessed, its potential to disrupt financial stability has to be guarded against. As the financial system gets increasingly digitalised, cyber risks are growing and need special attention, the Governor said.

However, regulatory clarity is yet to emerge with respect to the cryptocurrency space in the country, the government is working to finalise a consultation paper on cryptocurrencies with inputs from various stakeholders and institutions, including the World Bank and the IMF.

The top bank operator’s warning comes at a time when the cryptocurrency, a totally decentralised and internet-based creation, market has seen major swings amid global uncertainties.

Dr. Deepak Kumar Sahu, President & CEO, VARINDIA