The authorities of the United States asked the Criminal Investigation Department (CID) to seize the property of the two promoters of BitConnect.
Bitcoin investment firm, BitConnect was promoted by Satish Kumbhani and Divyesh Darji in 2016. The company has discontinued its operations at the beginning of the year. BitConnect was an open source cryptocurrency and investment program which was based on a multilevel referral system. The program had promised its investors to give exceptionally high returns on their investments. The promoters of the company are suspected of raising around $5.6 billion (INR 41,000 crore) from investors. BitConnect investment program accused of being a Ponzi scheme.
In the company maximum funds were poured in 2016, after the demonetization of high valued currency notes in India. Investors of BitConnect transferred their Bitcoins to the firm and in return, they used to get BitConnect coins. These BitConnect coins were tradable and investors were also getting interested in these coins. The promoters promised 800% annual returns which lured thousands of investors. At that point in time, one BitConnect coin was worth around $360. Because of the attractive return promises, people invested their Bitcoins in the company. After the scam, BitConnect was delisted from all crypto exchanges. Tradesatoshi was the last exchange where the BitConnect coin was trading. The platform has also delisted the coin on 10th September.
Illinois and Arizona two states of the U.S. wrote to Indian Criminal Investigation Department of Gujarat to seize the property of the promoters of BitConnect. According to a CID official, the citizens of two states Illinois and Arizona have invested their hard earned money in BitConnect and lost their money that is why the states are asking to seize the BitConnect properties of the promoters.
Divyesh Darji was arrested at Delhi airport on his way back from Dubai. According to CID officials, a warrant has been issued against Satish Kumbhani. A red corner notice (RNC) will be issued soon to track down Kumbhani. Some time ago Kumbhani was in South Korea but now he is back in Dubai. He has handled the worldwide operations of the BitConnect and it is expected that he may have possession of a large amount of money in Bitcoins which belongs to the investors of the company.