Unocoin’s Crypto ATM In India Seized, Co-founder Arrested

News | October 24, 2018 By:

Police in the Indian city of Bengaluru has arrested Harish BV, co-founder and chief technology officer of crypto exchange Unocoin, for setting up a crypto ATM without any approvals from authorities.

According to local reports, Harish had installed the crypto ATM at Kemp Fort Mall on Old Airport Road with his partner Sathvik Viswanath, CEO and co-founder of Unocoin. The Central Crime Branch of the local police seized the ATM, two laptops, a mobile, three credit cards, five debit cards, a passport and Indian rupees worth about $2,500.

Unocoin hasn’t been able to transact through regular banking channels after the Reserve Bank of India (RBI) banned banks from working with crypto companies in April of this year. Earlier this month, the exchange launched the crypto ATM to allow investors to directly deposit Indian rupees to their accounts with the exchange. At the time, Unocoin co-founder Sunny Ray said that the company was planning to open few more ATMs in Mumbai and Delhi.

The police said that the crypto ATM installed by Unocoin in Bengaluru’s Kempfort Mall has not taken any permission from the state government and is dealing in cryptocurrency outside the remit of the law.

“They did not have any license from the RBI, the Securities and Exchange Board of India (Sebi) or any other agency to carry out the bitcoin transaction,” said Alok Kumar, additional commissioner (Crime), Bengaluru city police. “They were running it without obtaining any trade license from the Bengaluru government (BBMP).”

Kumar added that more arrests are likely and requested the public to not get lured in by prospects of making money and not to invest in bitcoin.

Viswanath said that the company had complied with RBI rules and that it was completely legal for buyers and sellers to own cryptocurrencies in India.

“We got a lot of bad press after the finance minister announced a ban in February 2018,” Viswanath said. “The minister’s statement was clear, he stated that 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.”