Indian authorities have seized nearly $190 million in cryptocurrency linked to the BitConnect Ponzi scheme, which collapsed in 2018.
Indian authorities have seized nearly $190 million in cryptocurrency linked to the BitConnect Ponzi scheme, which collapsed in 2018. The Enforcement Directorate (ED) in Ahmedabad conducted raids on Feb. 11 and 15 in Gujarat, confiscating digital assets, 13,50,500 Indian rupees (around $15,582) in cash, an SUV, and multiple electronic devices. The investigation was launched after multiple police complaints were filed in Surat.
BitConnect, which operated from 2016 to 2018, allegedly defrauded over 4,000 investors across 95 countries, amassing around $2.4 billion. Investors were promised returns as high as 40% per month through a supposed “volatility software trading bot.” Authorities found that no actual trading occurred, and the funds were instead transferred into digital wallets controlled by BitConnect’s founder, Satish Kumbhani, and his associates.
Kumbhani was charged by the U.S. Department of Justice in 2022 but remained a fugitive. Recently, Indian authorities tracked him to Ahmedabad and issued a lookout notice to prevent him from fleeing. The ED discovered that many transactions were routed through the dark web to obscure their origins, but forensic tracking helped investigators identify linked wallets and assets. Officials are now working to recover funds for victims, including foreign nationals who lost money in the scheme.
Some victims took matters into their own hands. In August 2024, the ED reported that Shailesh Babulal Bhatt, who had lost money investing in BitConnect Coin (BCC), allegedly kidnapped two of Kumbhani’s employees with the help of accomplices. Bhatt and his group reportedly extorted 2,091 Bitcoin, 11,000 Litecoin, and around 145 million Indian rupees ($1.7 million) before releasing the captives. According to authorities, Bhatt took this action in an attempt to recover his lost investment.
The Enforcement Directorate’s crackdown on BitConnect comes as part of a larger effort to combat cryptocurrency fraud. Meanwhile, the FBI’s “Operation Level Up” initiative reportedly prevented potential crypto fraud victims from losing approximately $285 million between January 2024 and January 2025.
As further investigations continue, authorities are preparing to take Kumbhani into custody and work toward restitution for victims.
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