CBI searches 60 sites in GainBitcoin scam

The CBI on Tuesday conducted raids at 60 locations across the country, including Delhi-NCR, Pune, Chandigarh, Nanded, Kolhapur and Bengaluru, as part of its probe into the Rs 6,600 crore GainBitcoin cryptocurrency scam, officials said.

The locations were linked to key accused in the scam, their associates and entities suspected of laundering the proceeds of crime, the officials said. Given the vast scale and complexity of the scam, the FIRs were registered in several states and UTs, including Jammu & Kashmir, Punjab, Chandigarh, Delhi, West Bengal, Madhya Pradesh, Karnataka and Maharashtra. The FIRs were subsequently transferred to the CBI by the Supreme Court, the officials said.

GainBitcoin was a Ponzi scheme launched in 2015 by Amit Bhardwaj (now deceased), Ajay Bhardwaj and a network of agents. The scheme operated through multiple websites under the facade of a company named Variabletech Pte Ltd.

The scheme lured investors by promising lucrative monthly returns of 10 per cent in Bitcoin for 18 months. The scheme encouraged investors to buy Bitcoin from different exchanges and invest them in GainBitcoin through cloud-mining contracts. The model followed a multi-level marketing structure, commonly associated with pyramid-structured Ponzi schemes where payouts were dependent on bringing in new investors.

Initially, investors received payouts in Bitcoin. However, the scheme began to collapse by 2017 when fresh investments dried up. To cover these losses, GainBitcoin unilaterally switched payouts to an in-house cryptocurrency called MCAP, which held significantly less value than Bitcoin, further misleading investors.

A senior CBI official said during searches, a few crypto wallets, incriminating digital evidence and digital devices were seized.