Last week the Ministry of Finance said that virtual currencies (VCs), including bitcoins, are not currencies. It further clarified that virtual currencies are not backed by government fiat. “For the government to give virtual currency a currency status has a bigger implication, especially due to the capital controls we have here in India. Currently, income-tax department, enforcement department, the Securities and Exchange Board of India and Ministry of Finance are tracking virtual currencies. You can expect further developments in the virtual currencies space in the coming weeks.