Indian security authorities have launched a powerful investigation into the circumstances surrounding 2,0000BTC, which has been described as “BitConnect fraud” involving a bitconnect investor and the promoters of the now rested bitcoin investment platform.
India’s Crime Investigation Department (CID) confirmed that the bitconnect investor Shailesh Bhatt allegedly defrauded BCC promoters as a way of paying them back after the collapse of bitconnect early this year.
How BitConnect fraud started
During the sweeter days of bitconnect, when it was paying daily return return on BTC investment, the bitcoin investment platform was also launched in India.
Bitconnect’s India chapter was managed in the state of Gujarat by three men: Diyash Darji, Satish Kumbhani, and Dhaval Mavani, who worked with the project’s promoters abroad and persuaded Indian investors to invest in, promising them daily return.
Bitconnect gained popularity in India, and people who’re interested in invested in the bitcoin investment platform with the hope of getting a “very high return on investment.”
Unfortunately BCC later confirmed officially on January 17, 2018 that it’s shutting down due to its ability to continue to pay the daily return, an enraged Bhatt ganged up with eight others on Mavani in December 2017, and extorted 2,000 bitcoins from the promoters.
“This is to inform all community members that we are closing the Bitconnect lending and exchange platform,” Bitconnect team had said.
Security operatives later picked him up a month later from his residence near Gujarat’s capital.
According ccn.com, CID officials were able to question Bhatt’s nephew – Nikunj – who was apparently part of the extortion gang as he possessed 12 bitcoins from the 2,000 bitcoin haul.
A CID official gave insight on the firm:
Apart from India, the firm has its presence in Indonesia, Vietnam, Hong Kong, Singapore and the US. We have identified a few accounts associated with the transactions and have intimated the respective banks about it.
After the collapse of BCC which was later termed as BitConnect fraud, some investors around the world instituted case against the btc investment platform, asking for damages.
Residents in the United States, United Kingdom, Canada, and Australia lost billions of dollar in the bitcoin scheme, which some critics had called cryptocurrency ponzi before it collapsed.