Indian government has made itself very clear when it comes to cryptocurrencies: "These are not legal tender."

This implies the Reserve Bank of India has not authorized any virtual currencies as a medium of exchange and offers someclarity on how India plans to treat bitcoin.

But should the central bank's decision deter you from investing in cryptocurrencies, possibly the most fundamental and revolutionizing invention of our times?

There's no straight answer to this but we can definitely look at the following two possibilities:

Let's start with the answer: no. You should not invest in bitcoin.

The reason why is that it's not an investment; just as gold and rare baseball cards are also not investments.

When we make a purchase, we are merely speculating on the prices, without any underlying factor or reasoning. So on some days, our speculation could bring in windfall returns, but there's a huge likelihood of our investment turning sour in no time.

An investment is something that has intrinsic value – that is, it would be worth owning from a financial perspective, even if you could never sell it.

Now how about saying yes to investing in bitcoin.

In this case, one needs to figure out whether this is a good time to buy. Meaning, do you think the price will continue to rise.

Bitcoin is an extremely risky investment and there's no clear way to analyze the price of bitcoins. Its better to gain some understanding about the currency, what affects it, what are its advantages and disadvantages before making an investment.

Beware of websites making tall claims that they will double your bitcoins as they are mostly scams or HYIPs (high yield investment programs).