The virtual currency market in India has become murkier than it was earlier after a warning was issued by the government of India yesterday. The country has only a handful of exchanges, but after the de-monetisation drive recently, the crypto activity went through the roof and now the government is worried that these currencies may be used to store illegal wealth.
That the Indian government was not happy with the proliferation of crypto currencies was amply demonstrated when the government raided and charged a popular exchange, zebpay, with criminal conspiracy to launder illegal money, some years back. Since then the exchange has reopened with KYC/AML verification and has again risen to be one of India's largest exchange volume wise.
But the new warning issued yesterday has shown that the government is still not receptive to such tech and has warned that any user, holder, investor and trader dealing with virtual currencies would be doing so at his/her own risk and has said the following in the parliament:
The absence of counter parties in usage of virtual currencies, including Bitcoins, for illicit and illegal activities in anonymous/pseudonymous systems could subject the users to unintentional breaches of anti-money laundering and combating the financing of terrorism laws
Please read the news article covering it here: http://www.thehindu.com/business/Economy/use-of-bitcoin-illegal-says-govt/article17702483.ece?homepage=true