India’s First Bitcoin ATM Seized; Founders Arrested

Oct 29, 2018 at 20:46

Founders of Indian crypto exchange Unocoin were arrested after setting up an allegedly unregistered Bitcoin ATM in Bangalore.

The Times of India City reported that Unocoin’s co-founder Harish BV was arrested by the police shortly after he installed the crypto ATM kiosk at the Kemp Fort Mall on Old Airport Road.

Although the earlier report of the news outfit only noted Harish BV’s arrest, a more recent article hinted that Sathvik Viswanath–another Unocoin founder–was also apprehended.

Business Today, a local business magazine, cited a press statement from the Central Crime Branch (CCB), explaining the arrest is due to Unocoin’s failure to secure “any permission from the state government and is dealing in cryptocurrency outside the remit of the law.”

The CCB is reported to have seized “a teller machine, two laptops, a mobile, three credit cards, five debit cards, a passport, five seals of Unocoin company, a cryptocurrency device and Rs 1.8 lakh ($2,460).”

On Twitter, the Bitcoin exchange clarified that the ATM was not even operational.

“Our Machine didn’t go well with few mainstream media reports who projected it under a negative light. The machine is still under final testing mode and it will be up and running in the upcoming week. The machine has been temporarily moved from its original place of installation,” read Unocoin’s tweet.

“The reason for panic is because of fake videos on Kannada and English channels. Due to this, our kiosk is not operational. We’ve been trying actively to get these videos pulled down,” it added.

Viswanath lamented how Unocoin went under fire after India’s Finance Ministry banned cryptocurrencies with its minister, Arun Jaitley, saying that the state “does not consider cryptocurrencies as legal tender.”

“Cryptocurrencies are not legal tender in India. He did not say ‘illegal tender.’ There’s a huge difference. It means you bear the risk of your investment and there’s no regulation for the industry,” the co-founder added.

Nevertheless, India’s government has launched a clamp down to eliminate the use of all types of crypto assets “in financing illegitimate activities.”