"India Seizes $198M in Bitconnect Crypto, Luxury Items"

Indian authorities have seized $198 million in cryptocurrencies linked to the Bitconnect Ponzi scheme, along with cash and luxury items. The Bitconnect scheme operated from 2016 to 2018, promising investors returns of up to 40% monthly through a fake trading bot. The scheme attracted global investors by claiming 3,700% annual returns but actually diverted funds to private wallets.

The Directorate of Enforcement (ED) in Ahmedabad conducted search operations on February 11 and February 15, 2024, under the Prevention of Money-Laundering Act. During these operations, authorities seized digital assets valued at approximately Rs. 1,646 crore ($198 million). The recovery included additional items beyond the cryptocurrency assets, such as Rs. 13,50,500 in cash, a Lexus vehicle, and various digital devices.

The investigation began following First Information Reports filed by the Crime Investigation Department in Surat. These reports detailed the operations of Bitconnect, which ran from November 2016 to January 2018. Bitconnect operated what investigators called a “Lending Program,” which was neither registered nor legal. The scheme promised investors extremely high returns, drawing in people from around the world, including many from India.

The company’s marketing strategy relied heavily on an international network of promoters. These individuals received commissions for bringing new investors into the scheme, creating a pyramid-like structure that helped the fraud grow rapidly. At the center of Bitconnect’s promises was a supposed “volatility software trading bot.” The company claimed this technology could generate returns of up to 40% per month for investors. They went further, suggesting daily returns of 1%, which would amount to roughly 3,700% annually.

Indian officials discovered that these returns were completely fictional. Instead of investing the money as promised, the operators moved funds to digital wallets under their control. The ED successfully tracked these wallets through a combination of technical analysis and ground-level intelligence gathering. The scheme collapsed in early 2018 when it was exposed as a Ponzi scheme. The total value of the fraud is estimated at $2.4 billion, affecting investors worldwide.

U.S. authorities have also taken action against Bitconnect’s operators. Glenn Arcaro, who served as the