Bitcoin exchanges suspend operations in India amid govt warning

Bitcoin exchanges suspend operations in India amid govt warning

Summary: India's Bitcoin trading platforms, including the largest, have suspended services following a recent public warning by the central bank over the risks of virtual currencies.

SHARE:
11

India's largest bitcoin trading platform has suspended its operations, citing a recent public advisory by the central bank highlighting the risks of virtual currencies, according to The Hindu.

The closure of BuySellBitCo.in, which sees about 12 million rupees of Bitcoin transactions monthly, has spooked a number of other trading platforms including INRBTC to stop services indefinitely.

buy sell bitcoin
Bitcoin exchanges suspend operations in India amid government warning.

"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. This is being done to protect the interest of our customers and in no way is a reflection of Bitcoin's true potential or price," said a statement on BuySellBitCo.in.

Another trading platform, INRBTC, said the only option now was to suspend services until further arrangements could be made. "All trades which have been executed till December 26, 2013, will be processed completely. All pending orders will be cancelled and the deposits refunded," the exchange said, in the report.

The central bank on Tuesday warned the public of Bitcoin's possible use in money laundering and terrorist funding. While no bans or restriction were issued, it led to a spike in the number of Indian Bitcoin users selling off their currency in late-evening trades, according the the report.

RBI's warning is seen as a potential lead up to a further clampdown, with the virtual currency's rising popularity prompting regulators worldwide to mull tighter regulations. Last week, China banned the use of Bitcoin by financial institutions and third party payment providers.

Topics: E-Commerce, Banking, India

About

Loves caption contests, leisurely strolls along supermarket aisles and watching How It's Made. Ryan has covered finance, politics, tech and sports for TV, radio and print. He is also co-author of best seller "Profit from the Panic". Ryan is an editor at ZDNet's Asia/Singapore office.

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

11 comments
Log in or register to join the discussion
  • How to make free bitcoin

    For a free 0.2 BITCOIN go to Cryptsy and use this code in the referrer field f117533ffe641c9fe91de6212e21d831f8114ebf Hurry, because i dont know how long it lasts.
    wakrein
  • What's that sound I hear?

    It must be the sound of a bubble bursting!
    Sir Name
    • I think it's coming

      There's been all sorts of bad Bitcoin news of late and lots of indications that whatever it's merits as a medium of exchange, it has some associated risks, and it pays to be careful when selecting an exchange or other trading partners. I'm quite sure it will go down substantially (maybe even hugely) in relation to the US Dollar at some point in the next year. A lot of its value is tied up in ideology and uncertainty about state issued currencies, so I would expect the value of Bitcoin to vary inversely with the state of the world economy and confidence in national governments.
      John L. Ries
    • The banker bubble is trying to protect itself from reality and justice.

      Bitcoin will win, banker parasites will lose, its just the banking parasites death throes.

      The sooner the parasite bankers and wall street gangsters are gone the better for all of mankind.
      Reality Bites
      • You think those who control trillions of dollars are going to allow this?

        The people who print trillions of US dollars, effectively taxing everyone on Earth who holds them? The people who orchestrate booms and busts so they can profit? Come on, they are not going to let bitcoin win. I really do hope I am wrong.
        jkurant
  • BuySellBitCo.

    Around 12 million Indian rupees ($193,493) worth of transactions were performed daily, through BuySellBitCo.in until it shut down

    http://bit.ly/IndiaBitcoins
    Emily Peter
  • Bitcoin is just a newer way to separate fools from their money.

    In that respect, it seems to be working pretty well.
    thetwonkey
    • Doesn't empty the middleclass's pockets as fast as the bankers.

      Bitcoin is open, bankers are thieves, criminals and traitors.... pick your poison.
      Reality Bites
      • Lots of prose, not much fact

        Bankers certainly have a poor reputation when it comes to investing for the good of society as opposed to the good of the shareholders, but for Joe Public who just needs a check book and a credit card, virtual currency is hardly the way to go. Now if you're Joe Criminal, you're super excited about virtual currency...
        ejhonda
  • middleman

    money is just the middleman between barters. We used to have local currency, and then
    national currency, there's even multi-national currency (the Euro).

    But you've always got to question the motives of people telling you things.

    So, what I read from this is lots of people (bankers) who make their living trading national currencies about are telling us to beware of the first global currency.

    Because a global currency means no more national currency trading, and hence no more jobs trading it.

    Bitcoin has just as much right to be used by the people of the world to barter between trades than any fiat currency, and in fact costs less to use than those other currencies.
    Mytheroo
  • This is risky ... but to every risk there is a mitigation measure

    A bit coin trading platform shut down overnight with investors losing millions of dollars.
    The RBI has taken the right step to shut it down because of the risk to investor's money. One way to regulate is to have them regulated in a way similar to banks... Make them follow KYC, AML norms and grant them licenses basis paid up capital, CRR and like banks they should be made to pay up people's money in case they go bankrupt. I think with risk mitigation measures like this, we can still ensure such platforms thrive.
    alopa.pradhan@...