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An unidentified lawyer files an FIR against Satish Kumbhani, the founder of Bitconnect

Bitconnect’s founder in more legal complications, as an unidentified lawyer from India files FIR against him

  • Bitconnect’s founder accused for running a Ponzi scheme
  • Kumbhani’s whereabouts not known
  • US filings against the founder of Bitconnect
  • Occurrence of ponzi scheme in crypto market

Bitconnect’s founder accused for running a Ponzi scheme

Bitconnect’s founder Satish Kumbhani, is wanted in US and India, as allegations against him get stronger, after an unidentified lawyer from India went on to file an FIR against him. Reportedly, the complaint was lodged after the investor, who chose to remain unidentified, lost around 200 bitcoins valued at around Rs 400 million. According to the police report, the investor had invested in multiple cryptocurrency investment platforms and lost all of his holdings.

BitConnect, which was established in 2016, was a well-liked initiative during the mid-2017 ICO craze. For a network that allegedly gave out 10% in interest earnings via its BCC cryptocurrency, it garnered billions from investors. Users who recommended other investors enjoyed even more advantages.

Kumbhani missing since the fraud allegations piled up against his name

According to the reports, it is believed that the founder of Bitconnect Kumbhani disappeared after running a Ponzi scheme, which actually frauded investors. The valuation of the fraud was at around $2.5 billion. As the scam came under the US’s regulatory authority, a search was already begun for the founder, but it was understood that, the founder had fled the country.

 The unidentified lawyer’s statement

According to the complaint given by the lawyer, Kumbhani and six others partnered and scammed him of his original investment of 54 bitcoins and also went on to fraud him in the returns of 166 bitcoins. He confessed that, all these frauds were carried out between 2016 and 2021.

The occurrence of Ponzi Scheme in cryptocurrency

The occurrence of Ponzi Scheme

Credits: Vivek Kaul

Essentially a Ponzi Scheme interests new investors into investing and the returns from such an investment are given to the already present investors unethically. Though this kind of practice is also seen in stock market, it is very seldom that a Ponzi scheme is successfully run. But, in cryptocurrency market, due to the absence of stringent regulations and absence of good frame work, the occurrence of Ponzi Schemes is more and the investors easily fall victim to such schemes.

To curb the fraudulent activities in the market, strict regulation is mandatory, with proper education to the investors about the systems and functioning of Ponzi Schemes


What do you think about Ponzi Scheme? Do you think the lawyer did the right thing by filing an FIR against Satish Kumbhani? Share your thoughts in the comment section below. Also if you found the content informative, then please share it with your friends and colleagues.



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