French police have dismantled an illegal Bitcoin exchange and seized 388 virtual currency units worth some 200,000 euros ($272,800) in the first such operation in Europe, a public prosecutor said on Monday, reports Reuters.
Two people in the cities of Cannes and Nice were placed under formal investigation on Friday and detained on suspicion that they operated a website which illegally sold and lent Bitcoins to its users.
During a raid last week on one of the suspects' homes, investigators seized a portfolio of Bitcoins, as well as credit cards and computer hardware.
"It's the first time in Europe that a judicial action has resulted in the closure of an illegal exchange for virtual currency," Olivier Caracotch, prosecutor in the southwestern town of Foix where the investigation started, told Reuters.
"It's also the first time in France that Bitcoins have been seized as part of a judicial procedure."
In the end, governments will only allow registered Bitcoin exchanges that will record names and identifications of all buyers and sellers. Governments will not be playing. Bitcoin is not a libertarian currency.