The Central Bureau of Investigation (CBI) conducted coordinated searches at 60 locations across India on Tuesday as part of its ongoing probe into the Rs 6,600 crore GainBitcoin cryptocurrency scam, officials said.
Massive Raids Across Multiple Cities
The raids were carried out in Delhi NCR, Pune, Chandigarh, Nanded, Kolhapur, and Bengaluru, targeting premises linked to key accused individuals. According to a CBI spokesperson, these searches aimed to gather crucial evidence related to the multi-level marketing (MLM) Ponzi scheme that defrauded thousands of investors.
Mastermind Behind the Scam
The scam was allegedly orchestrated by Amit Bhardwaj (now deceased) and his brother Ajay Bhardwaj through a network of fraudulent platforms, including www.gainbitcoin.com. Launched in 2015, the scheme operated under the facade of Variabletech Pte. Ltd., luring investors with the promise of high returns in Bitcoin.
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How the Ponzi Scheme Operated
GainBitcoin followed a classic MLM structure, where payouts depended on recruiting new investors. Initially, investors received Bitcoin payments, reinforcing the illusion of legitimacy. However, by 2017, as the influx of new funds slowed, the scheme collapsed.
To cover up the financial shortfall, GainBitcoin unilaterally switched payouts to its in-house cryptocurrency, MCAP, which had significantly less value than Bitcoin, misleading investors further.
Supreme Court Transfers Case to CBI
Due to the scam’s vast scale and international implications, multiple FIRs were registered across India, from Jammu & Kashmir to Maharashtra and from Delhi to West Bengal. The Supreme Court assigned the case to the CBI to conduct a comprehensive investigation, trace the misappropriated funds, and identify all accused individuals.
Seizures During Searches
During the raids, the CBI seized multiple crypto wallets, incriminating digital evidence, and digital devices. Officials also confiscated emails and cloud-based data, which could provide further insights into the operation’s global reach.
The agency is now focusing on tracking international financial transactions related to the scam and holding all responsible parties accountable.