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| Amit Bhardwaj, the alleged mastermind behind the GainBitcoin scam, was arrested in March 2018 |
The Supreme Court on Friday asked central government whether Bitcoin is illegal in the country or not while hearing a matter relating to the GainBitcoin scam. The court orally enquired central government whether Bitcoins are illegal or not.
The court enquiry came while hearing the petition seeking cancellation of bail against Ajay Bhardwaj, one of the co-accused among others in this case. Responding to the court's question, Additional Solicitor General Aishwarya Bhati said that accused Ajay Bhardwaj is allegedly involved in the fraud of Bitcoins.
A bench of Justice DY Chandrachud and Justice Surya Kant, meanwhile, directed accused Ajay Bhardwaj to co-operate in the investigation extended his interim protection from arrest till the next date of hearing. The court listed the matter for hearing after four weeks.
The Enforcement Directorate (ED) has lodged a Money Laundering case against Ajay Bhardwaj and others under the provisions of PMLA, 2002 on the basis of two FIRs, one at Pune and the other at Nanded. ED said that the investigation did so far has revealed that M/s Variabletech Private Limited, Singapore, its Directors ie Amit Bhardwaj along with brother Ajay Bhardwaj, Vivek Bhardwaj, and father Mahendra Bhardwaj hatched a criminal conspiracy in connivance with other accused persons to cheat the general public at large through its website www.gainbitcoin.com.
It was projected by the accused that M/s Variabletech Private Limited, Singapore is involved in blockchain and cryptocurrency mining technology and has a mining farm in China and the company, through its cloud mining service provider, Gainbitcoin.com, acquires the cloud mining hash power from large vendors by paying them in form of Bitcoin.
It was further projected that people could purchase a small part of cloud mining space (Hash Value) for 18 months through a contract made with M/s Variabletech Private Limited and can get the assured return of 10 percent per Bitcoin for 18 months, ED said.
The investigation conducted so far has revealed that the petitioners with the connivance of others, that is, multi-level marketing agents and associates have collected 80,000 Bitcoins (whose value is approximately Rs. 20,000 crores as of today) as Proceeds of Crime.
Amit Bhardwaj, the alleged mastermind behind the GainBitcoin scam, was arrested in March 2018 and later granted bail by the Supreme Court on April 3, 2019. ED had also sought to cancel Amit Bhardwaj's bail plea.
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