Unocoin Co-Founder Arrested Over Non-Functional Bitcoin ATM in India
A multi-million Indian scam involving investments in a supposed cryptocurrency is unraveling. | Source: Shutterstock
Indian authorities have arrested the co-founder of Unocoin, an upstart Bitcoin exchange in India.
According to Times of India , Harish BV, co-founder of Unocoin, was taken into custody for illegally operating the “first” Bitcoin ATM in the world’s second-largest nation, located in Bangalore. The BTM was located in the Kemp Fort Mall .
Bitcoin ATM Not Even Working At Time of Arrest
As earlier reported, Unocoin had been taking baby steps in the implementation of its cash-to-coin (and vice versa) operations. They wrote on Twitter :
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.
People in the cryptosphere are no strangers to the dangers of toxic misinformation. Another founder of Unocoin, Sathvik Viswanath, told the media that the BTM was not actually even running at the time of Harish BV’s arrest. It was in “final testing mode.” A likely source of the police involvement was mall management, as according to Viswanath, the mall’s management had recently become uneasy about the BTM’s presence.
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.
The Struggle Ahead for Crypto India
Bitcoin and other cryptocurrencies are hardly new, but every country and culture have taken their own paths to adoption and acceptance. Government policy on the subject is extremely important in this regard, and the Indian government appears to be like most governments: decidedly not in favor and in some ways vehemently against. Viswanath pointed to specific remarks from earlier this year from the Indian Finance Minister Arun Jaitely specifically stated that bitcoins are not “legal tender” in India and that the government would work diligently to prevent cryptos from being used in “illegitimate” activities.
Viswanath is quick to point out that not qualifying as legal tender does not make Bitcoin an illegal asset.
The minister’s statement was clear: 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.
Nevertheless, a crypto businessman sits in jail today, with local police using the media to discourage people from engaging in Bitcoin activity and promising more arrests. His firm offers an Android walle t, a liquid market for Ether and Bitcoin, and it is with some degree of irony that as recently as June they were writing in defense of US regulatory practices as regards Bitcoin .
Like anything else, government over-reaction to cryptocurrencies and bullying leads to black markets, which are exactly the sort of thing the government has promised to mitigate. As such, the Indian LocalBitcoins market appears strong, with apparently better rates for acquisition. LocalBitcoins is more of a “gray” market, with peers incurring their own risk in making in-person trades on a daily basis the world over.
Featured image from Shutterstock.
