Cryptocurrency is Like Chit Funds and Can Cause Losses Anytime - Says Ex RBI Governor, Raghuram Rajan

Raghuram Rajan, the former Governor of the Reserve Bank of India (RBI) believes that most of the cryptocurrencies today will not survive in the long run.

According to him, the cryptocurrencies that exist today pose a threat to the security of your investments in the long run. Just like unregulated chit funds, most of these cryptocurrencies can disappear, causing losses to people who invest in crypto assets.

However, only a handful of cryptocurrencies may continue to survive and may also be used for cross-border payments in the future.

Rajan is not the only one who voiced concerns over cryptocurrency trading. RBI Governor, Shaktikanta Das also suggests building a strong and formal framework to regulate cryptocurrency dealings in India.

The central government will very soon discuss a comprehensive bill on digital currencies to ensure there is no fraudulent activity and people don’t lose their hard-earned money.


1. What is cryptocurrency?

A cryptocurrency is a form of payment or digital currency that can be traded online to pay for the goods and services provided by certain companies. Cryptocurrencies like bitcoins are similar to casino chips and tokens that you can buy with real currency.

2. How many cryptocurrencies exist today?

There are nearly 6,000 cryptocurrencies as of 2021. However, most of these cryptocurrencies are not as significant as the top 20 cryptocurrencies.

3. What are the most traded cryptocurrencies?

The most traded and the most popular cryptocurrencies include Bitcoin, Ethreum (ETH), Litecoin (LTC), and Polkadot (DOT).

4. Are cryptocurrencies a good investment?

Cryptocurrencies may help you generate great returns as they tend to go up in value. But cryptocurrencies are not real investments. If you want to generate profit, someone else needs to buy it at a higher rate than you did. Also, the cryptocurrency market is highly volatile. So, you should invest in them carefully and only with expert advice.