- Indian authorities have seized almost $190 million worth of crypto tied to the BitConnect Scam
- Authorities uncovered dark web transfers across many crypto wallets
The Indian law enforcement has seized about $190 million in cryptocurrency linked to the BitConnect Ponzi scheme. This is one of India’s biggest actions to combat crypto fraud.
The Enforcement Directorate (ED) in Ahmedabad has seized Rs 1,646 crore worth of digital currency in the BitConnect scam. Reports have it that investors were tricked into believing they were making secure securities investments.
Unraveling the BitConnect Crypto Ponzi Scheme
BitConnect was formerly a cryptocurrency platform that operated between 2016 and 2018. It collapsed under allegations of being a Ponzi scheme. The Platform was founded by Satish Kumbhani. BitConnect offered a proprietary digital currency called BitConnect Coin (BCC) and promised high returns through a lending program.
The platform claimed it had developed exclusive trading software that were designed to manage market fluctuations and give investors monthly profits of up to 40%.
The Enforcement Directorate of Ahmedabad started their investigation about the platform due to multiple police complaints in Surat. The investigation revealed a complicated network of transactions across many crypto wallets, to find out who controlled them. Many transfers went through the dark web to hide their tracks.
However, by following different wallets and using ground intelligence, the officials were able to trace the wallets and locate the places where the devices holding the digital currency were stored.
Other Assets Seized By the Indian Government
The authorities also confiscated ₹1.35 million ($15,582), an SUV, and various electronic gadgets. These assets were linked to individuals associated with BitConnect.
Over 4,000 investors were defrauded across 95 nations, which resulted in an estimated loss of $2.4 billion. The investigation is still ongoing as authorities work to uncover more details about the fraud.
Satish Kumbhani was charged in 2022 by the US Department of Justice but remained a fugitive until Indian authorities recently traced him to Ahmedabad. The ED has issued a lookout circular to prevent his escape and is preparing to take him into custody.
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