Authorities confiscate cryptocurrency linked to BitConnect as investigations into the fraudulent scheme continue.
Enforcement Directorate Raids Gujarat BitConnect Base
Indian enforcement agencies have seized cryptocurrency worth $190 million (Rs 1,646 crore) in connection with a major BitConnect Ponzi scheme investigation. The Enforcement Directorate (ED) conducted raids across Gujarat on Feb. 11 and 15, uncovering illicit assets linked to the fraudulent crypto investment platform.
BitConnect Crackdown Expands in India
The ED has intensified its probe under the Prevention of Money Laundering Act (PMLA) after initial complaints were filed by Surat’s CID Crime Police Station. Apart from the seized crypto, officials confiscated $16,300 (Rs 13,50,500) in cash, an SUV, and multiple digital devices.
Tracking Down Evidence from 2016
Authorities revealed that BitConnect orchestrated a global Ponzi scheme between 2016 and 2018, promising investors returns of up to 40% per month. The company lured users into acquiring BitConnect Coins (BCC) under the pretext of a high-yield investment powered by an AI-driven trading bot.
$2.4 Billion Ponzi Scheme Used New Investor Funds
BitConnect’s alleged volatility trading software falsely displayed daily returns of 1% (3,700% annually), creating an illusion of profitability. However, the scheme operated as a classic Ponzi scam, where new investor deposits were used to pay off older investors instead of actual trading.
The Cease and Desist Orders Against BitConnect
The project raised an estimated $2.4 billion globally before collapsing in 2018, following cease-and-desist orders from U.S. regulators. Investigators found that BitConnect’s founders funneled funds into private digital wallets instead of the claimed trading activities.
ED Uncovers Dark Web Crypto Transactions
Authorities traced a complex network of digital transactions designed to obscure BitConnect’s illicit earnings. Many of these transfers were routed through the dark web to conceal fund origins. Despite these efforts, investigators successfully tracked multiple web wallets holding the illicit funds.
Continued Investigation
This latest seizure adds to previous ED actions, which included the attachment of $56.5 million (Rs 489 crore) in assets. Officials confirmed that foreign nationals were also involved in the scheme, with U.S. authorities conducting a parallel investigation into key suspects.
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