The cryptocurrency market is not regulated in India, and the Indian government does not consider crypto as a legal tender or investment. The Reserve Bank of India banned all banking channels to crypto entities in April this year. This forced several crypto exchanges to create P2P trading facilities in a panic. A few months after the ordeal, Unocoin, a homegrown crypto exchange tried to establish India’s first cryptocurrency ATM in Bengaluru. Its co-founder Harish BV has now been arrested by the local police.
Unocoin’s Crypto ATM Dreams Trashed
The cryptocurrency exchange established the first crypto ATM in the country about a week ago in Kemfort Mall Bengaluru amidst much fanfare. The ATM allowed users to deposit and withdraw a minimum of Rupees 1,000. Unocoin wanted to install similar ATMs in other parts of the country.
Now, the police have arrested the company’s co-founder Harish BV. The police also seized some gadgets from the co-founder, along with Rupees 1.79 lakh in cash. His seized assets include two laptops, one mobile phone, five debit cards, three credit cards, five company seals, one passport and one cryptocurrency device. He was produced at the 1st ACMM Court in the city before being taken into custody. He will remain in custody for seven days.
The Cyber Crime department of the Central Crime Branch (CCB) said in a statement:
“The ATM kiosk installed by Unocoin in Bengaluru’s Kempfort Mall has not taken any permission from the state government and is dealing in cryptocurrency outside the remit of the law.”
Legal Problems With Crypto Transactions in India
One should note that the Indian government has a hawkish stance on digital currencies and the country’s law doesn’t allow for the operation of them within its boundaries. Every currency that is not issued by the government of India is considered to be foreign currency in the country. Therefore, Bitcoin and other altcoins will technically be foreign currencies and fall under the rules of FEMA. Moreover, they are not recognized as legal tender, creating further problems for the company.
There are questions about the mechanisms that Unocoin used to convert fiat to crypto and vice versa at the ATM since no rules regarding the exchange of digital currencies to INR exist in India.
The local authorities, meanwhile, consider the ATM a case of possible fraud. All ATMs in India are operated within the ambit of RBI regulations by banking entities. Therefore, Unocoin’s use of the word ‘ATM’ calls for charges of fraud.
Crypto Exchange Unocoin Co-founder Arrested in India for Setting up Crypto ATM was originally found on [blokt] – Blockchain, Bitcoin & Cryptocurrency News.