"India Seizes $189M in BitConnect Crypto Assets, Cracks Down on Ponzi Scheme"
1min read Indian authorities have made a significant stride in their investigation into the BitConnect scam, seizing cryptocurrency assets worth $189 million. The Enforcement Directorate (ED) in Ahmedabad led the operation, meticulously tracking the assets through detailed analysis of wallet transactions and dark web activity. In addition to the digital assets, officials also confiscated a luxury vehicle, cash, and electronic devices.
The crackdown is part of an ongoing effort to dismantle the fraudulent scheme that operated from 2016 to 2018. BitConnect lured investors with promises of high returns, claiming to use an automated trading bot to generate profits. However, authorities confirmed it was nothing more than a Ponzi scheme, where funds from new investors were used to pay earlier participants.
Victims were encouraged to deposit Bitcoin or cash into the platform, believing they would earn massive gains. Instead, the money was funneled into wallets controlled by the scheme’s operators. Investigators traced the movement of these funds across multiple wallets, many of which were intentionally hidden using the dark web. Despite the complex laundering attempts, detailed tracking of IP addresses, wallet flows, and blockchain activity led authorities to the assets.
This latest seizure follows legal action against BitConnect’s founder, Satish Kumbhani, and its chief US promoter, Glenn Arcaro. Arcaro was sentenced to 38 months in prison in 2022 and ordered to repay $17.6 million to victims across 40 countries. Meanwhile, Kumbhani faces multiple charges, including wire fraud, commodity price manipulation, and international money laundering. If convicted, he could be sentenced to up to 70 years in prison. However, he remains a fugitive and has yet to be captured.
The BitConnect scheme defrauded investors of an estimated $2.4 billion before collapsing when authorities uncovered its deceptive practices. The ED’s latest action highlights the continued pursuit of justice for victims and reinforces global efforts to combat financial fraud in the crypto sector.
