Just three days after the Reserve Bank of India (RBI) issued a public advisory which warned against the use and trade of digital currencies, authorities have carried out the first bitcoin raid in the country.
In Ahmedabad, the Enforcement Directorate (ED) raided the premises of Mahim Gupta, the man behind India’s biggest trading platform, buysellbitco.in. A separate raid was carried out in another part of the city, although the authorities do not appear to have found the second suspect in the office.
Violation of foreign exchange regulations
During the preliminary investigation, the Enforcement Directorate found that buysellbitco.in was in clear violation of the Foreign Exchange Management Act, reports DNA India.
“We have found that through the website 400 persons have recorded 1,000 transactions that amount to a few crores of rupees. We are gathering the data of the transactions, name
of the people who have transacted in the virtual currency from Gupta’s server that is hired in the US,” said an ED official.
“At present, we believe that this is a violation of foreign exchange regulations of the country. If we are able to establish [a] money laundering aspect then he can be arrested.”
Authorities estimate the total volume of transactions on buysellbitco.in was between Rs20-30 crore, or $3.2 to $4.8m. The unnamed ED official said:
“The biggest threat is that without recording your transaction in [an] official foreign currency platform, money can be transferred like hawala with the use of this transaction. We are examining such instances, if any, here.”
http://www.coindesk.com/indian-authorities-swoop-buysellbitco/
