Unocoin’s Marketing Mistake- A few weeks ago the co-founders of India’s own bitcoin start-up were arrested for setting up the country’s first cryptocurrency ATM in the city of Bangalore without government permission.
The word “ATM”
One of the co-founders of Unocoin, Sathvik Vishwanath believes that the word “ATM” sparked the confusion. He further added that this is just a kiosk which enables their customers to transact with the company and not by any means an ATM that requires the approval of the country’s banking regulator, the Reserve Bank of India (RBI).
Hence, Vishwanath recognizes that this was an inadvertent marketing mistake on the company’s part. In the marking of the booth, and in prior communications to the general population. Unocoin had alluded to the machine as an ATM. It is likely that if the word ‘ATM’ had been left out, the law enforcement agencies would not have taken such a hostile view. It just added fuel to the fire, as there is a sense of legitimacy attached to the word ‘ATM’ given that the impression perceived is typical that it is part of a banking channel. This led to more anxiety among the police as they thought it was possibly a misrepresentation.
Unocoin’s Marketing Mistake-According to Vishwanath, the Unocoin bitcoin kiosk did not need any regulatory approval, unlike traditional banking ATMs. In a tweet, he pointed to the fact that because of media reports, an image had been painted that the ‘bitcoin kiosk’ resembled a bank ATM and subsequently required the approval of the RBI. This is likely what set off the police raid, believes Vishwanath.
Harish and Vishwanath’s arrest has sent a chill through India’s cryptocurrency market.
The two founded Unocoin in 2013 in Bangalore. The company now has nearly 1.3 million customers and 45 investors across five countries. Despite a spate of cryptocurrency-related crimes, Unocoin has never been investigated by authorities.
The 2 founders remain in judicial custody, waiting for their bail application to be heard. They will now face a variety of charges including engaging in unlawful and unlicensed operations. They will also be tried for forgery and cheating. The arrest of Unocoin’s founders, therefore, has rattled the community.