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India's Directorate of Enforcement Seizes $190M in BitConnect Fraud Case
BitConnect's founder, Satish Kumbhani, is wanted in both India and the U.S.
Feb 17, 2025, 11:30 a.m.
What to know:
- India's Directorate of Enforcement seized almost $190 million worth of crypto during its BitConnect fraud investigation.
- BitConnect's founder Satish Kumbhani, an Indian citizen, has been sought by Indian police since 2023 after he disappeared following a U.S. indictment.
India's anti-money laundering unit said it seized about 16.5 billion rupees ($190 million) worth of crypto, some cash and a Lexus car during investigations into the collapse of the BitConnect cryptocurrency fraud.
BitConnect, founded in 2016 by Satish Kumbhani, raised billions of dollars from investors for a protocol that purportedly paid out 10% in interest earnings. The Ponzi scheme collapsed in 2018, and in 2023 a California judge ordered $17 million in restitution to be paid to the victims.
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Kumbhani, an Indian citizen, was indicted in the U.S. and is wanted in India.
The firm's claims to invest the money "were a sham, as the accused knew that BitConnect did not deploy investor funds for trading with its purported Trading Bot rather, they siphoned investors’ funds off for their own benefit, and their associates’ benefit, by transferring those funds to digital wallet addresses controlled by them," the Directorate of Enforcement (ED) said in a Saturday statement.
A "complex web of transactions" through "numerous crypto wallets" was used to hide the identities of the wallets' owners.
"However, by tracking numerous web wallets and gathering ground intelligence, ED was able to zero-in-on the wallets and the premises where the digital devices containing said crypto currencies were available," it said.
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CFTC Launches Digital Assets Pilot Allowing Bitcoin, Ether and USDC as Collateral
Acting Chair Caroline Pham has unveiled a first-of-its-kind U.S. program to permit tokenized collateral in derivatives markets, citing "clear guardrails" for firms.
What to know:
- The CFTC has launched a pilot program allowing BTC, ETH and USDC to be used as collateral in U.S. derivatives markets.
- The program is aimed at approved futures commission merchants and includes strict custody, reporting and oversight requirements.
- The agency also issued updated guidance for tokenized assets and withdrew outdated restrictions following the GENIUS Act.
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