Bitconnect Exchange Kingpin Who ‘Lured Investors’ Arrested in India

Murkier details of the Bitconnect cryptocurrency scam have emerged as police have arrested the head of the defunct cryptocurrency exchange.

[Note: This is a guest article submitted by Bhushan Akolkar]


Bitconnect — A Pyramid Scheme of Scams

Last Saturday, August 18, Indian authorities arrested Divyesh Darji, the Asian head of defunct cryptocurrency exchange, in a high-profile scam worth 880 billion Indian Rupees ($12.6 billion). Local news publication Times of India reported that Divyesh Darji was arrested by the Gujarat CID upon his arrival at Delhi Airport from Dubai. The accused has been moved to the Gujarat capital Gandhinagar for further investigation. 

Darji was one of the promoters of Bitconnect along with Dhaval Mavani, Satish Kumbhani, and Suresh Gorasiya, who have been accused of siphoning investor’s money from the cryptocurrency exchange.

The Bitconnect scam reported earlier this year involves a notorious case of extortion in addition to deceit and fraud.

The Bitconnect scam reported earlier this year involves a notorious case of extortion in addition to deceit and fraud. The launch of Bitconnect simultaneously with the Indian demonetization of November 2016, also raised a lot of questions.

In November 2016, the Indian government demonetized 500 and 1000 INR currency notes in an attempt to choke the circulation of black money in the market. During this period, Bitconnect shot to fame among Indian investors as most of the money was siphoned off into digital assets.

Investigative officer and DGP of CID Crime, Ashish Bhatia said:

The company was registered in the UK and had an office in Surat. They launched their own ‘bitconnect coins’ soon after demonetization. They promoted the company on social media and by holding gala functions in cities across the world. They lured investors with 60% monthly interest, and incentives in the form of referral interest.

This case came to limelight when a Surat-based businessman, Shailesh Bhatt filed a case of deceit, fraud, and extortion against 11 people including Bitconnect promoters. A further police investigation into this matter unearthed multiple cases of crypto scams carried out through the exchange.

Bhatt had previously invested Rs.1.80 crore in digital assets through Bitconnect, which shut down its operations this year in January. The police investigation revealed that Bhatt had allegedly kidnapped Bitconnect promoters Piyush Savaliya and Dhaval Mavani and extorted 2,019 bitcoins, 11,000 litecoins, and Rs 14.50 crore cash. One CID crime official revealed that they recovered 169 bitcoin with over 8 kilograms of gold from Bhatt.

Just when it seemed the case couldn’t get murkier, it was found that Mr. Bhatt was later kidnapped by Surat LCB inspector Anant Patel and eight other policemen, along with the involvement of ex-MLA of Gujarat’s ruling party, Bharatiya Janta Party (BJP).

As the CID crime officials and investigative agencies try to solve the complexities of the case, these interconnections of multiple small scams could possibly lead to a single larger scam. Bitconnect’s promoters, owners, and administrators have been registered under the IPC section for cheating, fraud, and deceit.

What type of consequences should Bitconnect promoters face? Share your thoughts below!


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UPS Files For a Patent for Blockchain-based Shipping System

Despite the fact that the overall cryptocurrency market has declined with around 70 percent since January 2018, interest in blockchain-based technology grows stronger. Yet another major company, UPS, demonstrates its serious intentions for implementing DLT in its operations.


UPS Boards the Blockchain Bandwagon

The shipping giant UPS has filed an application for a patent with the US Patent & Trademark Office.

The company seeks legal protection for a system which takes advantage of blockchain-based technology for storing different types of information within a distributed ledger network. The data includes details about the package’s destination, its actual movement, as well as transportation plans and others of the kind. The patent reads:

An exemplary method comprises receiving and storing in a distributed ledger service offers for transporting a shipment unit; receiving and storing in a distributed ledger shipment unit data comprising an origin, a destination, and transportation parameters; matching service offers stored in the distributed ledger to the shipment unit data to generate a transportation plan for transporting the shipment unit in accordance with the shipment unit data […]

 The shipping giant UPS has filed an application for a patent with the US Patent & Trademark Office.

Blockchain in the Shipping Industry

UPS is not the first major company to explore the possibilities of distributed ledgers in the shipping industry.

The Commonwealth Bank of Australia (CBA) recently shipped and tracked as much as 17 tons of almonds using distributed ledger technology, as well as smart contracts and Internet of Things (IoT). The project was carried out in collaboration with five international and domestic supply chain leaders. Speaking on the matter, CBA Managing Director of Industrials and Logistics in Client Coverage Chris Scougall said:

Our blockchain-enabled global trade platform experiment brought to life the idea of a modern global supply chain that is agile, efficient and transparent. We believe that blockchain can help our partners reduce the burden of administration on their businesses and enable them to deliver best-in-class services to their customers.

How do you think blockchain technology can enhance the shipping industry? Don’t hesitate to let us know in the comments below!


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Paul Krugman Admits Bitcoin Has More Utility Than ‘Dead’ Gold

US economist Paul Krugman appeared to soften his stance on Bitcoin last week in a surprise twist, saying he believes the cryptocurrency “has more utility than gold.”


Krugman: Bitcoin ‘Has Some Chance To Be Valuable’

Speaking at the ChainXChange conference in Las Vegas, which ran August 13 – 15, Krugman, who had previously made a name for himself as a Bitcoin skeptic, even forecast a future in which Bitcoin has “value” as an entity.

“Gold is dead… Bitcoin has more utility than gold,” he said during a panel featuring infamous Bitcoin bulls including Fundstrat Global Advisors’ Tom Lee.

There is some chance for Bitcoin to be valuable in the future.

Prior to the somewhat unexpected vote of confidence in Bitcoin, Krugman had made headlines at the end of July after he paradoxically likened Bitcoin’s technology to “setting the monetary system back 300 years.”

His words produced a flurry of both press coverage and criticism from cryptocurrency figures, Nick Szabo suggesting Krugman was beholden to the fiat-based way of thinking.

“Evolution is something that happens in a very decentralized and parallel way; the central banking Krugman worships has been the opposite of that,” he retaliated.

Mixed Signals Continue

In a manner similar to fellow economist Robert Shiller, who had publicly admitted he “doesn’t know what to make of” Bitcoin despite lambasting it, Krugman similarly told the panel he “only halfway understands” it.

The comments came as a form of counterbalance to the contents of a speech he had given previously, in which he repeated his claims about setting the economy back centuries.

“What problem is it supposed to solve? We are using this clever algorithm to bring monetary economics back to the 17th century. The monetary system we have works pretty well,” he had added.

Despite individual economists’ misgivings, Wall Street continues to give ever stronger signs it intends to interact with Bitcoin as an asset which will endure.

What do you think about Paul Krugman’s latest comments on Bitcoin? Let us know in the comments below!


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