Premises of two bitcoin trading websites raided in Ahmedabad

Ahmedabad, 27 December 2013

Acting on a tip-off a team of 15 Enforcement Directorate(ED) officials on Thursday raided two places in Ahmedabad for illegally trading of bitcoins through their websites.

Bitcoin is unregulated, digital money issued and controlled by its developers in Korea. It is used by a specific virtual community primarily for money laundering across the world. It is not authorized by any central bank. Bitcoin account is operated through 80-100 characters long password. Money is deposited in electronic wallet.

Ahmedabad’s Bopal based Mahendra Gupta operates buysellbit.co.in while city’s satellite area based Nilam Doctor operates rbit.co.in for bitcoin dealing.

Mahendra Gupta has registered Seven digital cash LLP company at Chhatral GIDC plot no. 2322/6 and 2322/7, however the ED officials found that said place is used for scrap loading and unloading, and there’s no trace of software activity. ED sources say Gupta developed software for an Australian firm and accepted bitcoins as payment and later started the trading platform through buysellbit.co.in.

Reserve Bank of India has issued a caution notice against bitcoins and other virtual currencies and warned that users may end up breaking anti-money laundering and terror financing laws.

The officials have sealed the premises of rbit.co.in operator Nilam Doctor and employed experts to download the details of over 1,000 bitcoin transactions done through two websites.

This is believed a first ED raid in India on bitcoin traders. China has banned financial institutions from bitcoin transactions this month. The price of bitcoin is Rs 42,737 as per an estimate.