Bitcoin Exchange In India Halts Trading, Following Advisory from Central Bank

[UPDATED: Reports have surfaced that the Enforcement Directorate (ED) - the governmental agency responsible for enforcing FX related regulations in India - has raided the premises of Mahim Gupta - operator of the BuySellBitco.in website - and alleges that he is in clear violation of the Foreign Exchange Management Act (FEMA), among other potential compliance violations. The raid was purportedly conducted on Thursday (a day after the RBI warning) when the ED conducted a separate raid -also carried out in the Bopal area in parallel -but had not found the person in question. Gupta was reportedly detained and could be arrested if a connection to money laundering violations can be established, according to an ED official quoted by the publication DNA India regarding the raids.

Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term Magnates' reporters contacted a company spokesperson at BuySellBitco.in who was unable to comment regarding the raid due that fact that their office is based at a different location in Banglore, and not at the registered addresses for Seven Digital Cash LLP where the raids were carried out by the ED (at the Bopal and Ghandinagar locations). Additionally, the staff in the remote support center -who we spoke to- are operating normally to support customers in wake of the notice the company put out halting their Bitcoin trading. ]

India’s largest Bitcoin trading exchange, BuySellBitco.in, has just suspended its buy/sell operations following a Reserve Bank of India’s (RBI) public advisory highlighting the risks inherent with dealing in virtual currencies, according to a recent report from The Hindu, a local Indian outlet.

Indeed, the suspension of services across other trading platforms seems to have originated with the trading halt of BuySellBitco.in, an exchange that deals with about 12 million rupees ($193,000) worth of transactions every month.

In particular, the INBRTC platform has halted its services indefinitely, despite the absence of any RBI bans or restrictions, and other Bitcoin operator websites have gone down since, according to reports by the media.

Furthermore, several Bitcoin trading websites are still in operation as the RBI caution was just that - a cautionary advisory, and not a warning or ban, as noted above. However, the advisory did note potential risks and violations that may have prompted firms to interpret the RBI's announcement in the manner that caused them to close shop, as the next steps the regulator might take are still uncertain.

Indian Bitcoin Users Sell In Panic-Induced Move After RBI Statement

The exodus fostered by the RBI caused a large number of Indian Bitcoin users to start selling the currency, according to Coin Market Cap, a crypto-currency valuation site. This came in the form of an issue this Tuesday, warning of the risks and potential misuse of Bitcoin, among them money laundering and funding terrorism.

Potential fluctuations in global prices of Bitcoin have been at the forefront of investigation for weeks, with prices recently trading on both the upper and lower sides within a large range indicating high volatility over a short period of time, as previously noted in research from Forex Magnates.

Despite its highly unstable value as of late, Bitcoin certainly affords many advantages to investors relative to conventional currencies. The allure of a monetary entity outside the realm of central banking certainly comes during a period where many investors are weary of recurring rate cuts and the ever-present specter of currency wars.

In addition, the robust complexity of Bitcoin is the source of its greatest intrigue, but also security, as advanced algorithms compute the amount of Bitcoins in circulation, aimed at preventing manipulation through its verification process and public Blockchain records, following successful mining and for each transaction.

As recently as today, BuySellBitco.in released a statement on its site, noting that, “Post the RBI circular, we are suspending buy and sell operations. This is being done to protect the interests of our customers and in no way is a reflection of Bitcoin’s true potential or price.” Alternatively, the Trading Platform Trading Platform In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real Read this Term INBRTC, claimed that the “Only option now was to suspend services until further arrangements could be made.”

Regulatory Framework for Digital Currencies Just Starting to Emerge

According to a senior RBI official, most exchanges and Bitcoin ‘mining’ start-ups are reading the recent advisory as a precursor to a possible clampdown or regulatory movement, especially as the central bank has reportedly refused to talk with several exchanges and companies regarding regulation. Other countries, such as China have banned companies from partaking in Bitcoin transactions, however, several U.S. government agencies have lauded Bitcoin for its legitimate benefits, and several sovereign nations have already begun the process of taking a position on whether or not to regulate it.

“Yes, BuySellBitco.in has shut shop. The RBI circular, however, said nothing new, nothing that we did not know. For our part, we have asked our legal team for an opinion, and are currently waiting for it,” noted Satvik V, Founder of CoinMonk Ventures in a recent statement, and organizer of India’s first Bitcoin conference earlier this month.

As regulators scramble to construct acceptable rules based on any laws implemented as a result of Bitcoin (and other digital currencies) becoming more mainstream -in respective jurisdictions- the feedback from industry, academics, research firms and retail traders could best help to make for efficient frameworks, as the regulatory landscape remains largely uncharted for cyrpto-currencies.