India bans cryptocurrency for all, Police liquidates the seized cryptocurrency worth $1.6 Million
India has completely banned trading cryptocurrencies. The exchanges have been informed by the Reserve Bank of India to not entertain any transactions involving cryptocurrencies. Furthermore, to immediate ban the bank accounts of users who indulge in crypto-exchanges.
Indian Police have the task of liquidating the cryptocurrencies that were seized since the ban by RBI all over the country. The leading cryptocurrency exchange in India, Zebpay warned it’s users explicitly that they won’t be able to withdraw any funds after 6th July 2018. This sudden announcement had left the users bewildered with a lot of questions in their mind.
Soon after the ban, none of the Indian citizens could transact crypto, no matter what. However, the court has permitted the police officials to liquidate the cryptocurrencies. The reason why the Indian government has banned the cryptocurrency is the fact that the chances of scams are way too high.
One such incident came from Pune, where a Bitcoin scam came to police’s notice. Cyber Crime cell arrested Amit Bhardwaj and his brother Vivek Bhardwaj along with 10 accused. Pune Mirror reported on Friday, June 6. Pune is the second largest city in the state of Maharashtra after Mumbai.
Amit was arrested by the Pune Police at the Delhi Airport, as he returned from Thailand. “Two cases were registered against him in Nigdi and one in Dattawadi in Pune,” noted The Hindu. “During the investigation, the cops seized 237.7392 bitcoins and 92.1 ethereum from the accused. At conservative estimates, the cryptocurrency scam is worth Rs 35,000 crore [~5.1 billion]. The special investigation team (SIT) of the Pune police’s cyber crime cell subsequently filed an application in the sessions court, seeking permission to sell the cryptocurrencies seized during the investigation,” details Pune Mirror.
Amidst all this, Police had no other go other than selling it themselves. While addressing the court, police asserted that to “protect the interest of investors…it has become imperative that the cryptocurrencies seized by the investigating machinery be sold or liquidated. Close to 8,000 investors, who were duped in the name of buying and investing bitcoins,” Pune Mirror elaborated.
Considering the order of the court for liquidating the cryptocurrencies, the police had the difficulties to complete the task. The Reserve Bank of India released a circular on April 6 banning the exchanges to serve cryptocurrency to anyone. Banks had exact three months to stop the services to both, the exchanges and customers. The ban is now in effect since July 6th.
Police documented to the court reads:
“The Reserve Bank of India has prohibited all the banks from providing services which include maintaining accounts, registering, settling, clearing, opening accounts of exchanges dealing with them and transfer or receipt of money in accounts relating to purchase or sale of virtual currencies.”
“The cops also brought to the notice of the court that Zeb IT Services Pvt Ltd [Zebpay] and other cryptocurrency exchanges in India had issued notices to their account holders that they will be unable to liquidate cryptocurrencies held by them and withdraw balance in rupees since the banks will stop providing settlement services from July 6.” Pune Mirror elaborated.