Cryptocurrency trade has not yet found a niche in the Indian market and therefore there are many uncertainties associated with it. The Reserve Bank of India is worried about the illegal flow of currency, theft and money laundering in crypto trade but there are several unlawful activities already involved with it.
A recent trend of crypto kidnapping has emerged from the Prime Minister’s home state which is even dubbed as crypto-trading Gujarat-style. It is allegedly said that the investors roped in cash through a bitcoin-based Ponzi scheme.
According to Bloomberg, it is stated that a property developer Shailesh Bhatt hailing from Gujarat claimed that he was kidnapped by a group of policemen. He was later asked by them to pay a ransom of 200 Bitcoin worth $1.8 million as per their trade value for his release. Furthermore, he explained that he had nowhere to go. Certainly, this is the first highlighted case of cryptocurrency kidnapping in India.
A team from the Criminal Investigation Department was later called in to collect pieces of evidence of the case and to find out the scale of the fraud. As per the latest developments in the case eight police officials have been charged and suspended from their duties until trial.
How Did The Traders Raise Money For Cryptocurrency?
The investigators nabbed the operators of cryptocurrency firm Bitconnect which was promoted by Satish Kumbhani. It is also mentioned that he has been allegedly involved in other similar scams as well. They recruited customers at a worldwide scale for depositing bitcoins and issued them BitConnect coins which can be given out at higher interest rates per month. The actual money started flowing in when the prices of Bitcoin soared high in December last year. There was an immediate money flow worth $3.2 billion directly into Bitconnect.
The officials are still figuring out the exact value of money which keeps fluctuating with the Bitcoin trade value.