Ministry of India Reveals Details of Investigations of Bitcoin Businesses

A document presented to the lower house of India’s parliament — the Lok Sabha — has unveiled an investigation of fraudulent actions of so-called “bitcoin companies” operating in the country.

An official question was submitted by center-left parliamentarian Mohammed Faizal and was answered by Minister of State for Finance and Corporate Affairs Anurag Thakur on March 16.

India’s politician demands investigation of “Bitcoin” companies regulatory status

Faizal presented the Minister of Corporate Affairs three questions regarding “Bitcoin” firms in India. First, he asked about the government’s awareness of a growing number of reports alleging “cheating and fraudulent practices by bit coin companies.”

He also asked if crypto firms in question “are repeatedly violating rules laid out by the Corporate Affairs Ministry by not filing annual balance sheets,” finally demanding details regarding any action taken against the offending companies.

It seems that only two crypto firms are registered with the Registrar of Companies

Responding to the request, Minister Thakur confirmed that the crypto firms hinted at by Faizal “are not defined under the Companies Act.”

He also states that only two companies operating with Bitcoin (BTC) have registration with the Ministry of Corporate Affairs’ Registrar of Companies — Zeb IT Services and Unocoin Technologies.

Thakur also notes that “prosecutions have been filed for violations under various provisions of the Companies Act” against Zeb IT before, and the company is now “under liquidation.”

The corporate affairs minister asserts that Unocoin is up to date with its filings, adding that there were no complaints concerning Unocoin presented to the ministry.

Crypto companies are eager to enter India after RBI ban lifted

Cryptocurrency businesses have rushed to start operations in India after the Supreme Court’s reversal of the Reserve Bank of India’s (RBI) ban on financial institutions providing services to businesses working with crypto.

Within 24 hours of the ruling Unocoin has resumed fiat deposit services, as well as OKEx partner Coindcx and Wazirx owned by Binance — despite Thakur’s statements indicating that neither exchange has a registration with the corporate affairs ministry.

On March 5, Kraken disclosed its plans to bring its services to the Indian crypto market. KuCoin also showed an interest in entering India on March 17.

India’s crypto sector still has to tackle regulatory challenges

Despite the recent enthusiasm, the future of India’s cryptocurrency industry is still unclear.

India’s parliament still has to rule out on the “Banning of Cryptocurrency and Regulation of Official Digital Currency Bill” from 2019, and the RBI is going to appeal to the Supreme Court revocation of the ban.