Indian authorities have seized assets, including a Lexus car, cash, and cryptocurrency worth approximately 16.5 billion rupees ($190 million) as part of an investigation into the collapse of BitConnect.
The Rise and Fall of BitConnect
BitConnect, established by Satish Kumbhani, promised investors a 10% return, attracting billions. However, the platform collapsed in 2018, exposing it as a Ponzi scheme. In 2023, a California judge ordered $17 million in restitution for victims. Kumbhani was charged in the U.S. and is wanted in India.
Fraudulent Claims and Financial Misuse
Before its collapse, BitConnect's coin saw an increase to $463.31, reaching a $3.4 billion market cap, leading to significant investor losses. The Directorate of Enforcement stated that BitConnect misled investors with false claims about trading through its 'Trading Bot'. The funds were actually diverted for personal gains of Kumbhani and associates.
Fraudsters Tracked Through Cryptocurrency Wallets
Kumbhani and associates used a complex web of cryptocurrency wallets to hide their identities. However, the Directorate of Enforcement traced these wallets and pinpointed the locations of digital devices containing the stolen funds. In 2024, Shailesh Bhatt was arrested for his involvement in the BitConnect extortion scheme.
The BitConnect case continues to highlight the need for stringent oversight in cryptocurrency investments globally.
