Posted on

Indian Police Crack Down On Ethereum Mining Operation Funded By Ponzi Scheme

14 Views
2 Total shares
Ethereum Mining Operation

Delhi police have seized Ethereum (ETH) mining equipment after launching a raid. The police say the mining facility began from funds of a $15 million Ponzi scheme.

Reports suggest that the Delhi Police managed to seize more than 100 Ethereum mining rigs including servers, 500 graphics cards and high-powered computers. Delhi Police official KPS Malhotra, shares that the Ethereum mining operation reportedly belongs to Vijay Kumar and Kamal Singh. Both men were under arrest and in custody about two weeks ago.

The police got wind of the mining operation after Kumar, who happens to be one of the founders, filed a complaint against a third partner, SS Alagh. The accusation is Alagh was planning to take over the crypto mining operation. Kumar told the Delhi Police that Alagh and his allies kidnapped him.

An online petition filed a month ago by a victim of the Ponzi scheme put police on high alert. According to reports, the victim had invested 0.1 BTC into the crypto mining operation. They were then promised a 12% monthly payout over a contractual duration of 18 months. The amount collected from the investment scheme was used to set up the mining facility.

Unfortunately, those who invested into the scheme have not received any returns on their investments after nine months. One of the victims of the Ponzi scheme stated they faced excuses every time they would ask about the returns. Eventually, Kumar and his team stopped receiving the calls from investors and turned their phones off most of the time.

All this comes at a time when India has adopted a harsh stance against cryptocurrencies and their related activities including trading and mining. Kumar and his team managed to stay off the radar and had even lied to an inquisitive neighbor. They told the neighbor they were running servers and a computer processor unit on behalf of a major tech company.

The police believe that the Ethereum mining operation managed to generate as much as $105,000 within three months. The authorities are also looking into whether the group had other mining operations in other areas.

Daily updates








LATEST CRYPTOCURRENCY NEWS FROM CRYPTOBLOCKWIRE

We are your go-to news source for everything cryptocurrency and blockchain in the U.S. and internationally.

CryptoBlockWire is your home for the latest cryptocurrency and blockchain news. It’s our job to provide you with access to the latest breaking news regarding Bitcoin, altcoins, and blockchain technology. There is nothing more exciting than being at the forefront of the cryptocurrency movement and financial consumer technology. CBW’s extremely knowledgeable writing staff use their experience and enthusiasm to publish the most current, accurate, and helpful stories in the entire crypto-sphere.