India's Crypto Economy
India's Crypto Economy is a brand-new weekly newsletter (delivered every Thursday) from Inc42 to help you decode the rapidly growing crypto economy and its implications on business, work and life. We launched this newsletter on the 4th anniversary of our weekly series “Crypto This Week” which completed 190 editions in May, 2021.
Umesh Verma, a 60-year-old Dubai-based man was arrested on January 1, 2021, from Delhi’s Indira Gandhi International Airport, on charges of duping at least 45 Bitcoin investors of INR 2.5 Cr through his purported cryptocurrency exchange Pluto Exchange.
Verma, who once had a jewellery business, had been arrested earlier in a gold smuggling case. In September 2020, Inc42 reported about the alleged cryptocurrency scam operated by Delhi-based Pluto Exchange, which marketed itself as a cryptocurrency investment firm. Pluto Exchange allowed customers to buy, sell, store and spend Bitcoins via a mobile number. In 2017, the company apparently launched India’s first mobile app which allowed people to transact in virtual currencies.
Pluto Exchange promised customers monthly returns in the range of 20%-30% with bonus commissions for referrals to other users. When it failed to return the investments to its investors, the exchange blamed the falling price of Bitcoin. Pluto’s bank accounts in India were then seized, prompting the company to shift its base to Dubai.
One of Pluto’s customers, after having invested INR 5 Lakh in the scheme, but not receiving any payout, tried to approach the company’s officials, only to find that the company was now based overseas.
The case of Pluto Exchange is just one example among a host of cryptocurrency scams in India in recent times. Scamsters seem to have taken advantage of the unfamiliarity among users about the risks associated with cryptocurrency, as well as the lure of big returns. Moreover, companies promising huge returns through investments in a new cryptocurrency, have also turned out to be scams, robbing unsuspecting customers of crores of rupees.
In 2020, Bengaluru Police began investigating three companies — Long Reach Global, Long Reach Technologies and Morris Trading Solutions. According to the police, these companies collected at least INR 15K each from over 11 lakh people from across the country to invest in a new cryptocurrency called Morris coin.
In previous conversations with Inc42, crypto experts have said that an easy way to distinguish genuine crypto exchanges from scams, is to stay clear of schemes that promise returns that are ‘too good to be true’. Further, newly-launched cryptocurrencies or altcoins should always be treated with scepticism, as a host of altcoins are regularly classified as ‘fake’ by crypto exchanges worldwide.
Bitcoin And Ethereum Prices
At the time of writing, Bitcoin was trading at $31,395, a nearly 18% increase from last week’s price of $26,702. Its market cap was around $583 Bn.
Ethereum was trading at $1031, a 44% increase from last week’s price of $715. Its market cap was around $117 Bn.
Bitcoin Could Hit $146K Long-Term By ‘Crowding Out Gold,’ Says JPMorgan
Strategists at the American multinational megabank JPMorgan Chase are forecasting a possible scenario in which Bitcoin can seriously take on its predecessor. On January 5, a Bloomberg report cited a note from the bank’s strategists, led by Nikolaos Panigirtzoglou, in which they sketched out a path to the total private sector investment in Bitcoin coming to equal the value that is currently invested in gold via either exchange-traded funds or bars and coins. Read the full Cointelegraph story here.
How Bulls Controlled Ethereum Price Even After 26% Correction
On January 4, the Ether (ETH) price rallied to $1,160, which was followed by a 24% correction within the following four hours. For the time being, the flow of positive news and solid fundamentals seem to be in play for Ether, but it is still important to try and understand whether the recent crash reflects a potential local top or if it was simply a retest of $900 as a new support level. Read the full Cointelegraph story here.