Indian Bitcoin Exchanges Closed Following RBI Warning

In a public advisory late last month, the Reserve Bank of India (RBI) warned of the risks involved with virtual currencies such as Bitcoin. The central bank advised users to be cautious, given virtual currencies’ potential use in money laundering and terrorist activities. The RBI appears to be determining whether regulation is necessary.

Following the announcement, BuySellBitCo.in, India’s largest exchange, said it was suspending buy and sell operations until it could “outline a clearer framework with which to work.” INBRTC, another Indian bitcoin exchange, also shut down.

DNA India
, an Indian publication, reported that BuySellBitCo.in owner, Mahim Gupta, has since been raided by authorities, who believe he may have violated the country’s Foreign Exchange Management Act.

The RBI’s warning follows
recent actions by the People’s Bank of China (PBOC)
, which have resulted in the usage of the currency being virtually banned. The PBOC has restricted Chinese banks from using Bitcoin in transactions, and has blocked Bitcoin exchanges from accepting inflows of cash. The actions by China have taken a toll of Bitcoin’s value.

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