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Indian feds raid Bitcoin exchange as other traders suspend service

28
Dec
2013

On Tuesday, the Reserve Bank of India sent out a stern warning against trade in Bitcoin and other virtual currencies, stating that the currencies were not approved by the central bank and more ominously that the traders of VCs on such platforms are exposed to legal as well as financial risks. It was an ambiguous message, seen by many as a restatement of the fundamental risks of virtual currency, but just a few days later, one exchange found out about those legal risks the hard way. On Thursday, officers from Indias federal Enforcement Directorate raided the offices of buysellbit.co.in, a prominent exchange in the Indian city of Ahmedabad. At present, we believe that this is a violation of foreign exchange regulations of the country. Following the raid, Buysellbitco.in has suspended trading, offering the following message on its homepage: Post the RBI [Reserve Bank of India] circular, we are suspending buy and sell operations until we can outline a clearer framework with which to work. In the wake of the raids, other exchanges like Inrbtc have followed suit, suspending trades and posting similar warnings.

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