Indian Authorities Seize $190M in Crypto Amid BitConnect Ponzi Scheme Investigation

In a significant crackdown, Indian authorities have confiscated nearly $190 million in cryptocurrency linked to the notorious BitConnect Ponzi scheme, which collapsed in 2018.

The Enforcement Directorate (ED) in Ahmedabad announced the seizure of cryptocurrency valued at ₹1,646 crore during their investigation into the BitConnect fraud, where numerous investors were allegedly duped under the guise of securities investments.

Beyond the substantial crypto assets, the ED also seized ₹13,50,500 (approximately $15,582), a sport utility vehicle (SUV), and electronic devices during raids conducted in Gujarat on February 11 and 15. These assets were reportedly connected to associates of BitConnect, a scheme that defrauded around 4,000 investors across 95 countries, resulting in an estimated loss of $2.4 billion. Launched in 2016, BitConnect met its demise just two years later.

BitConnect's founder, Satish Kumbhani, was charged by the U.S. Department of Justice in February 2022. He allegedly established a global network of promoters, incentivizing them with commissions to propagate the Ponzi scheme. Between November 2016 and January 2018, the accused reportedly amassed funds from investors worldwide, including those from India.

In a dramatic turn of events, some victims sought their own form of justice. In August 2024, the ED reported that Shailesh Babulal Bhatt, who suffered losses investing in BitConnect Coin (BCC), collaborated with accomplices to kidnap two of Kumbhani's employees. They extorted 2,091 Bitcoin, 11,000 Litecoin, and approximately $1.7 million (₹145 million) for their release. The ED noted that Bhatt undertook this drastic measure to "recover his investment."

Meanwhile, the FBI's "Operation Level Up" initiative reported saving potential crypto fraud victims approximately $285 million between January 2024 and January 2025, highlighting ongoing efforts to combat cryptocurrency-related fraud.