India’s Enforcement Directorate (ED) has intensified its crackdown on the infamous BitConnect cryptocurrency scam, seizing crypto assets worth $190 million. The move comes years after BitConnect, a fraudulent Ponzi scheme that surfaced in 2016, collapsed, wiping out billions from investors globally.
ED Seizes $190 Million in Digital Assets
On February 15, the ED’s Ahmedabad office confirmed the seizure of digital assets valued at approximately ₹1,646 crore ($190 million) under the Prevention of Money Laundering Act (PMLA). The action follows multiple First Information Reports (FIRs) filed by the CID Crime Police Station in Surat.
In addition to the cryptocurrency haul, authorities confiscated $15,582 in cash, a high-end SUV, and several digital devices during a series of raids in Gujarat.
Investigators revealed that BitConnect’s operators had created a complex network of crypto wallets to obscure transactions. However, through advanced blockchain tracking and intelligence gathering, authorities traced key wallets and their controllers, leading to the latest enforcement action.
The Rise and Fall of BitConnect
BitConnect operated as an unregistered entity, using a multi-level marketing model where promoters earned commissions by bringing in new investors. The scheme promised high returns through a so-called “trading bot” but ultimately functioned as a Ponzi scam.
In February 2022, the U.S. Department of Justice indicted BitConnect’s founder, Satish Kumbhani, for orchestrating the fraud. At its peak, the scheme raised an estimated $2.4 billion before shutting down in 2018 after regulatory warnings from U.S. authorities.
With this latest seizure, Indian authorities are ramping up their investigation, aiming to bring those responsible for the massive fraud to justice.