The Bitconnect saga continues as Divyesh Darji, the alleged head of Bitconnect’s Indian operations, has been arrested at Delhi airport.
Darji had been living in the United Arab Emirates city of Dubai where Bitconnect operated its cryptocurrency scam from the world’s tallest building, the Burj Khalifa.
P G Narwade of the Indian state of Gujarat’s Criminal Investigation Department (CID) stated that Darji was hiding out in Dubai and a look-out circular was issued for him. When immigration alerted the CID of his flight into India he was arrested at the airport. It has not been made clear why he chose to return to India at this time.
The Bitconnect Ponzi-scheme
Bitconnect took advantage of Indian investors who were affected by the countries demonetization campaign that saw the government ban 500 and 1000 rupee notes. The campaign was allegedly an attempt to thwart a growing black market that the government believed was funding terrorism and other illicit activities.
As a result of the move, many Indian citizens began looking for other avenues of storing their wealth in fears for the countries economic stability. Bank runs followed which resulted in cash shortages and a drop in stock indices that caused national panic.
During the huge increase in the cryptocurrency market value of late 2017, Bitconnect took on large amounts of investment through an aggressive online media campaign. However, following the crash of early 2018, the masterminds behind the scheme quickly bailed and fled abroad, taking investors money with them.
Launched in February 2016 in Indonesia, the Bitconnect cryptocurrency reached a market cap of $2.7 billion in early 2018, before collapsing. One of the proponents of the scheme, Carlos Matos, became infamous for his bizarre Youtube videos promoting Bitconnect in Thailand. As a result, Youtube has been implicated in the legal proceedings of the Bitconnect case.
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