India has been an enthusiastic market when it comes to cryptocurrency investments. However, an overwhelmingly large number of Indian investors are first-time investors in the crypto-trade, making them susceptible to scams. A number of crypto-related scams have been rising in the Indian markets, with the most recent one being the biggest. A Rs. 500 Crore ($7.3 Million) cryptocurrency scam was recently unearthed in India, named MoneyTradeCoin (MTC).
MoneyTradeCoin was similar to many other Ponzi crypto schemes that have been going around across the world where up to 20 times returns were guaranteed in four to six weeks of investment. Interestingly, some high net-worth investors were also being offered citizenships in African and Caribbean countries, claiming that their MTC cryptocurrency would soon be a legal tender in these nations.
An investigation from leading Indian media house India Today found that a senior MTC official Digamber Jangle was making these promises. Jangle even claimed that the company was in touch with the government of Antigua and Barbuda islands and that the MTC cryptocurrency would be adapted as a legal tender in the island nation.
Investors were being lured with these fake promises of getting a citizenship in one of these nations as well as high returns on their investments. However, it was all a part of the Ponzi plan and an exit scam was being planned where the creators of the MoneyTradeCoin would escape with the investors' money.
Interestingly, the company behind the MoneyTradeCoin (MTC) was The Flintstone Group, a name which many might remember as one of the several companies to have filed a case against the RBI’s banking embargo. This comes as a major jolt to India’s fight for crypto-rights as one of the petitioners has now been accused of being a fraudster. Reportedly, the company has been operating since 2016 under the guise of a real estate firm.
Thane police have now registered a case against the owner of The Flintstone Group - Amit Lakhanpal, as well as against his associates. All the prime accused have managed to escape the country as of this writing. However, recent reports indicate that Taha Kazi, who provided technical support to the company has now been arrested. Police are now working towards tracking down others accused in the case.
Reports from local media outlets indicate that the police have raided the offices of the company and have seized 53 laptops, several rubber stamps and fabricated documents and various other pieces of evidence which are now being examined. It is being suspected that the company, trying to prove its legitimacy, might even have invested in a Bollywood movie featuring a major male actor. As of this writing, technical details and the scale of operations of this scam are still unknown and investigations are currently underway.
Over the past few months, India has been facing a tough time when it comes to cryptocurrency regulations. India’s top banking authority - the Reserve Bank of India had issued a circular asking all regulated financial institutions to stop providing services to those dealing in cryptocurrencies. A number of petitions have since followed - but incidents such as these weaken the cause of the petitioners!