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Nationwide raids on 9 Bitcoin exchanges

Beginning early morning, team of IT officials stormed 12 premises of prominent virtual currency exchanges, including Zebpay and Unocoin.

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Multiple teams of tax sleuths Wednesday, investigating virtual currency Bitcoin's investors and transactions, conducted raids at nine cryptocurrency exchanges in Delhi, Bengaluru, Hyderabad, Mumbai, Kochi, Hapur and Gurugram.

The raids come a month after the Supreme Court issued notice to the Centre and its agencies, including SEBI, Income Tax Department, RBI and ED to apprise it about their stand on Bitcoin and other cryptocurrencies and how to regulate them.

Beginning early morning, team of IT officials stormed 12 premises of prominent virtual currency exchanges, including Zebpay and Unocoin.

Sources told DNA, "We are collecting the name of investors and their transaction details. The survey under Section 133A of the Income Tax Act, is being conducted for gathering evidence for establishing the identity of investors and traders, transactions undertaken by them, identity of other parties, bank accounts used, among others."

Bitcoin, though illegal in India, has jumped about 16-fold this year as investors continue to flock to this cryptocurrency as a safe investment option.

"Even though virtual currencies do not have legal status in India, cryptocurrency exchanges have been adding over 3,500 users a day and now have reached 8 lakh downloads, said a source privy to the matter.

DNA had first reported last month how cryptocurrencies were replacing the cash component in the real estate.

Also, several real estate brokers, who have left the sector, are now luring investors to invest in Bitcoins, promising them returns of more than 300 per cent in just three months.

Recently, the RBI issued an advisory, telling investors to beware of investing in cryptocurencies.

However, despite the RBI refusal to give regulatory clearances, many leading Indian Bitcoin exchanges like Zebpay and Unocoin offers crypto coin trade, possiblly through online banking.

The Finance Ministry had also constituted an Inter-Disciplinary Committee to review virtual currency both in India and globally and suggest measures to monitor these currencies.

About the raids

  • Though illegal in India, Bitcoin has grown about 16-fold in 2016 
  • Cryptocurrency exchanges have been adding over 3,500 users per day 
  • Nine cryptocurrency exchanges were raided, beginning early morning
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