India's first bitcoin ATM in Bengaluru shut down by police, co-founder arrested; Here's why

Crime Branch police have registered a case against the currency exchange firm and also arrested company’s co-founder in violation of the RBI norms.

The ATM kiosk was set up despite the crackdown by the Reserve Bank of India on cryptocurrency trading in India. (Image: Unocoin/ Twitter)

Bengaluru: Just days after a cryptocurrency startup Unocoin installed India’s first Bitcoin ATM in Bengaluru, the Crime Branch police of the city registered a case against the currency exchange firm and also arrested company’s co-founder in violation of the RBI norms. “The 37-year old Harish BV, hailing from Tumakuru in Karnataka, was arrested Tuesday and two laptops, a mobile phone, a device for crypto currencies and Rs 1.79 lakh cash were seized among others from him,” new agency PTI quoted the police as saying. “”The crime department also stated that the ATM kiosk at city’s Kempfort Mall was installed without required permission from the state government,” the crime department said adding that the facility is dealing in virtual currency outside the remit of law. The ATM kiosk was set up despite the crackdown by the Reserve Bank of India on cryptocurrency trading in India. Police, who took the action on their own, produced him before the first additional chief metropolitan magistrate court, which remanded him in police custody for further questioning. Police also asked people not to get lured by the claims of making quick bucks through illegal crypto currency. RBI had told the Supreme Court in July that allowing dealings in crypto currencies like Bitcoins would encourage illegal transactions and it has already issued a circular prohibiting the use of these virtual currencies. The ATM kiosk installed by the virtual currency exchange company Unocoin at the Kemfort mall in Bengaluru allowed customers to deposit and withdraw amount of up to Rs 1,000. The unique ATM was accessible only to the registered customers of Unocoin. Customers were allowed to buy or sell up to 10 Bitcoins a day. The company had also stated that all transactions have to be made in India rupee only and thereafter the customers can exchange it into the currency that want. Cryptocurrencies became popular in 2017 following a remarkable surge of Bitcoin from $5,000 to $20,000 in a span of around 60 days. This also led to many governments to act and declare it either illegal or legal.