India declares war on bitcoin

After a stern warning from Reserve Bank of India and an effective ban on bitcoin transactions, Indian law enforcement agencies have decided to raid the country's bitcoin exchanges.

For the last several months RBI, the Indian central bank, has been trying to prop up the rupee by blocking gold imports. India is one of the world's biggest markets for gold and precious metals trade has a big negative impact on the country's balance of payments. Now, RBI discovered that Indians are using bitcoins to avoid capital controls and to invest in assets unsusceptible to inflation. To a certain extent, bitcoin is becoming India's "digital gold", attracting the ire of the country's authorities. In order to stop the "leakage of funds" from rupees to bitcoins, the regulators first issued a warning for all Indian users of the digital currency:

"The absence of information of counterparties in such peer-to-peer anonymous/pseudonymous systems could subject the users to unintentional breaches of anti-money laundering and combating the financing of terrorism (AML/CFT) laws."

http://voiceofrussia.com/2013_12_29/India-declares-war-on-bitcoin-1922/