Government Efforts to Stop Bitcoin’s Illegal Activities

The Indian government is currently deciding whether to regulate Bitcoin. Meanwhile, some members of parliament are working to crack down on illegal activities involving the digital currency. In an interview I spoke with Sandeep Goenka, co-founder of Indian leader Zebpay, to learn more about the situation in his country.

The Indian Ministry of Corporate Affairs is responsible for the implementation of corporate law. It has recently instructed the Bureau of Investigation of Serious Frauds (SFIO), regional directors and the Registrar of Companies “to gather details about the companies involved in bitcoin businesses,” reports the Economic Times, India’s leading business newspaper.

The statement was sent by the ministry to Lok Sabha deputy and BJP leader Kirit Somaiya, who has raised concerns about “illegal exchange and trading of bitcoins in the country,” according to the publication. The government is concerned about the risks associated with digital currencies and “the possibility of them being used to dupe investors.”

Authorities have been instructed to focus on investors, depositors, the public and interested parties who may be adversely affected and businesses that may use bitcoin “to attract the gullible public in fundraising,” explained in the posted.

Government efforts could be directed primarily at pyramid schemes, rather than legitimate bitcoin exchanges and business. “There are 1-2 pyramid schemes that are marketed as Bitcoin mining in India,” Goenka said.

“I think Mr. Somaiya’s intentions are well meaning in the sense that he might have got news regarding pyramid schemes disguised as Bitcoin mining,” Goenka described. “Unfortunately the good intention has been confused with the technology.”

It was reported that the Indian government formed a committee in April, the committee “is currently studying this industry and might give recommendations to the government in June / July,” Goenka said, adding that:

Right now the committee is expected to give a recommendation. Based on the recommendation, the government will decide the next action step. I think the whole process will take at least a year before there is any clarity on regulation. Meanwhile, bitcoin trading in India has been growing significantly. Last month, Zebpay announced that it had reached a milestone of over 500,000 app downloads, with more than 2,500 users added daily. On the peer-to-peer bitcoin exchange Localbitcoins, trading volumes in India’s rupee hit record highs last week.

Source: Bitcoin.com

Disclaimer: InfoCoin is not affiliated with any of the companies mentioned in this article and is not responsible for their products and/or services. This press release is for informational purposes only. Information does not constitute an investment advice or an offer to invest.

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