Union Finance Minister Arun Jaitley said on Tuesday that the government was awaiting an expert committee’s report before it sets up regulations on the use of cryptocurrencies.

Speaking in the Rajya Sabha, Jaitley reiterated the government’s stance that such digital currencies are not legal tender, and people dealing in them will not get any legal protection. He was answering a question asked by MP Kanimozhi, who had asked whether the Centre was considering to regulate cryptocurrencies.

There is no mechanism to prevent the misuse of cryptocurrencies by terror groups and other anti-national elements, IANS quoted Jaitley as saying.

“One of the features of cryptocurrency is that there is lack of dependence on the state,” Jaitley said. “It functions with a degree of anonymity. It operates within a virtual community which is created and enjoys the trust of that virtual community.”

He said the committee examining the matter was headed by the Economic Affairs Department secretary.

On December 29, the government had compared virtual currencies to ponzi schemes, and warned people of risks in dealing with them – including that it could result in “permanent loss of money”. The Ministry of Finance said virtual currencies are not legal tender and do not have “any regulatory permission or protection” in India.