India's "Cryptocurrency Guru" Arrested for Bitcoin Ponzi Scheme
An author, a trusted cryptocurrency expert, a celebrity and now, the alleged mastermind of a Bitcoin-related Ponzi scheme. Amit Bhardwaj was arrested by police in India's Delhi airport on Thursday, upon returning from Bangkok. Bhardwaj is accused of being the brains behind a Ponzi scheme, victimizing approximately 8k people, and stealing and estimated Rs 5,000-13,000 crore ($751M - $1.95B USD). Bhardwaj is one of many, of whom have already been arrested in relation to this case. His three companies (Gain Bitcoin, GB21, and GBMiners), are said to have promised investors high investment returns, a promise on which was never followed through.
As reported by businesstoday.in, GainBitcoin launched in Dec. 2015, as a Bitcoin investment opportunity, promising 10% returns (paid in Bitcoin) for investors. In May 2017, Bhardwaj created his own crypotcurrency token, MCAP, and offered to pay investor returns using MCAP, in lieu of Bitcoin, touting this option as 'more lucrative'. Eventually, investors made complaints that the terms and conditions regarding payouts were changed overnight, stating that MCAP would now be the ONLY option for returns payouts. As angry investors began to complain, Bhardwaj was already gone from the country and was no longer opening any lines of communication with them; the website went down for alleged "maintenance", however the site never went back online. At the time, it was estimated that Bhardwaj made off with about Rs 2000 crore ($300M USD), but that figure was determined based on investors in India.
It was later realized that Bhardwaj's reach was international; his operation had expanded to UAE, Ukraine, Hong Kong, Russia, Venezuela and Indonesia. A police consultant, Pankaj Ghode, told the publicaton, India Today this:
As actual facts and figures are still being summed up, there are still many investors whom have not yet come forth, for fear stories like this one, from investor and merchant navy officer, Rajiv Kumar:
Parvendra Singh, an investor affected by the scheme, was met with similar issue when coming to authorities; Parvendra alleges, "I struggled for months to explain this case to different authorities -- from talking to local police to writing to the RBI, SEBI, the HMO and the PMO. Once I learnt that he was in Dubai I went there to meet him." Singh tracked Bhardwaj down at an exclusive party in in Dubai, later meeting with him in his office, and recorded the conversation. Bhardwaj was recorded bragging:
If Bhardwaj's proclamation is true, it will take some time to get to the bottom of how many parties were actually taken advantage of, and the total sum of the stolen funds.