GainBitcoin Scam Size Grows Multifold To INR 90,000 Cr, Over 1 Lakh Victims

The total number of victims in the GainBitcoin scam stands at more than 1 Lakh, while more than 3,85,000 Bitcoins were collected under Amit Bhardwaj as part of various schemes, an investigation by Inc42 has found.

These numbers do not include Ether, cash and MCAP tokens collected as part of the scam. Bharadwaj, the main accused in the case, passed away in January this year due to a cardiac arrest.

With the help of crypto analysts, documents and other information provided by the people close to the investigation, Inc42 has been able to establish that at least 3,85,000 Bitcoins were collected by Amit Bhardwaj and others involved in the scam through mining and various multi-level marketing (MLM) schemes.

Taking the current Bitcoin price of around INR 23,57,250 per Bitcoin, the total amount comes to around INR 90,500 Cr.

“As per the excel sheets recovered from one of the ‘Seven Stars’, we found a list of 80,000 user IDs who deposited their Bitcoin to that particular wallet,” an official said. As per him, over 86K Bitcoins were collected in his wallet.

Like all MLM schemes, GainBitcoin also had a pyramid structure, with Bhardwaj at the top and then his ‘Seven Stars’ who used to operate in India and abroad. The other persons were below the Seven Stars in the pyramid.

Manu Sharma, Pankaj Adlakha, Amit Yadav, Sanjay Dua, late Surinder Singh Alagh, Naveen Pathak and Gautam Khanna were counted as the Seven Stars of the Ponzi scheme. Most of these Seven Stars have been absconding and have not appeared before the Enforcement Directorate (ED) yet, sources told Inc42.

GainBitcoin Is The Biggest Crypto Scam

According to victim Parvendra Singh Shahoo, who recently handed over a letter to Maharashtra Home Minister Dilip Walse Patil demanding to set up a Special Investigation Team (SIT) under Pune DCP Bhagyashree Navtake, the total number of Bitcoins collected by Amit Bhardwaj and others may be above 6 Lakh.

However, only 3,85,000 Bitcoins have been estimated to be the minimum number of bitcoins collected. Inc42 has been able to trace 7 wallets sourced from various websites of Amit Bhardwaj, including GBminers and Bitcoin Growth Fund, which showed the collection of 2,25,839 Bitcoins.

However, there remain at least 6-7 wallets untraced, including the wallets of other Seven Star members that were used for collection purposes and hard wallets that were primarily used to hodl cryptocurrencies.

“We have so far only been able to trace only one of the Seven Stars’ wallets which had collected 86K bitcoins. We have not been able to trace all the Seven Stars. Even if we take an average of 50K per Star, it will exceed 3.5 Lakh.

Adding the mined Bitcoins and Bhardwaj’s own amount, it will definitely be much higher,” one of the investigators in the case told Inc42.

Bitcoins Were Being Mined Even When Bhardwaj Was in Jail

Bhardwaj was arrested in March 2018, and remained in Pune Police custody till he received bail from the Supreme Court in April 2019.

However, the mining wallets remained operational even during this period. Many of the wallets were operational when he was in jail and recorded transactions, an official of the Pune Police said.

For instance, one of the GBMiners wallets, which shows a collection of 6,760.92 Bitcoins, continued to record mining rewards till June 19, 2018.

Pune Police and the ED suspect that Ajay Bhardwaj, the brother of Amit Bharadwaj, being the director of most of the companies was equally involved in the scam.

Maharashtra Has The Highest Number Of Victims

According to another official of the Pune Police, while it is difficult to find out the exact number of GainBitcoin investors, the police have traced over 1 Lakh victims using user IDs and emails that they have found. Of these, Maharashtra has the highest number of victims, and this can be seen from the FIRs filed in the case. So far, around 35 FIRs have been registered countrywide in the scam, of which around 13 FIRs were filed in Maharashtra by the victims.

Limited Investigation Limits The Scope 

The officials of Pune Police, in their conversations with Inc42, expressed their inability to carry out a thorough forensic analysis in the case.

“We did want to hire international blockchain analysis firms like Chainalysis but due to the limited budget, we could not,” one of them said.

This has effectively slowed down the pace of the investigation. The two local crypto experts, Pankaj Prakash Ghode and Ravindra Patil, who were supposed to assist the Pune Police in the case were later found to have cheated the Police and were arrested.

This has made the Pune Police even more cautious in its approach. The officials are also sharing very limited information with other agencies investigating the case.

As the ED, Mumbai Police, Punjab Police, Delhi Police, and Kashmir Police are late entrants in the investigation, they have limited information and might be shooting in the dark, one of the victims said, adding that they can make any breakthrough only if the Pune Police shares complete information with them.

Recently, Ajay Bhardwaj appeared before the Punjab Police in Amritsar in relation to the scam.

Amidst all these, on the other end of this deepening scam and never-ending investigations are the victims, who, having invested their life savings, are hoping against hope and impatiently waiting to get back at least a part of their investments.

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