$763 Million Bitcoin “Black Money” Scam "Masterminded" By India's Ruling Bharatiya Janata Party, Says Indian Congress

Omar Faridi
  • Prominent Indian politician Shaktisinh Gohil has alleged that the recent demonetization by India’s government was exploited by the country’s ruling Bharatiya Janata Party (BJP) to convert “its black money into white.”
  • Gohil also alleges that $763 million worth of “black money” was converted to Bitcoin, while some Congress members have said that the cryptocurrency was used in the conversion of as much as $12 billion in black money.

Shaktisinh Gohil, spokesperson of the All India Congress Committee, recently accused the leaders of the Bharatiya Janata Party (BJP) in Gujarat of orchestrating a “Bitcoin Scam” of over Rs 5,000 crore ($763 million).

The BJP is currently India’s ruling party and the All India Congress Committee is the main decision-making authority of the Indian National Congress. Reportedly, the cryptocurrency scam involves the use of Bitcoin (BTC) to convert very large sums of black money.

On Thursday, India’s Congress called for the country’s Supreme Court to launch a judicial investigation into the alleged bitcoin scam. Besides Gohil, a number of other Congress members have come forward and accused the BJP leadership of converting as much as Rs 88,000 crore (approximately $12 billion) worth of black money into cryptocurrencies.

Gohil claims that it’s a “multi-layered” scam, but the total $12 billion worth of cryptocurrency allegedly used in illicit activities would account for more than 10 percent of Bitcoin’s current $112.6 billion market capitalization (according to data from CryptoCompare).

State Police Accused Of Blackmailing And Extortion

Gohil further noted:

A new mega bitcoin scam has been unraveled in Gujarat. The finger of suspicion of this massive scam of illegal cryptocurrency directly points to several top Bharatiya Janata Party leaders and a mastermind — an absconding BJP leader and former MLA Nalin Kotadiya.

He added that the alleged bitcoin scam was like a “Pandora’s box” and that unlawful “hawala transactions” were being carried out by BJP leaders with the assistance of corrupt police department officials.

The Indian politician also said that, “There were reports of the state police blackmailing some businessmen in Surat for extortion and named a former BJP legislator as one of the kingpins.” Additionally, some of India’s Congress members suspect that certain cases of kidnappings and other violent crimes could also be linked to organized illicit activities involving cryptocurrencies.

Links To Bitconnect Extortion Case

It appears that this recent bitcoin scam can be traced back to Shailesh Bhatt, an Indian investor who bought into Bitconnect’s fraudulent “1.1 percent profit per day” scheme. When Bhatt did not receive the expected returns, he reportedly extorted 2,000 bitcoins from Dhaval Manavi, an Indian Bitconnect promoter, in December 2017. Soon though, Bhatt was apprehended by the country’s Criminal Investigation Department (CID).

In the present bitcoin scam probe, investigators raided Bhatt’s business offices and discovered that several police officers had assisted Bhatt in extorting bitcoins. Legal action was later taken, after the end of the investigation, against state police chief Jagdish Patel and a number of other officials found to be involved in the crime. Other people reportedly involved in the crime include Nalin Kotadiya, who was questioned by India’s Central Intelligence Department, and is believed to be engaged in illegal bitcoin transactions with multiple different parties.

Gohil now thinks that Kotadiya’s arrested “will reveal damning evidences which will expose top BJP leaders in the state." The politician even stated that the use of cryptocurrencies to convert black money to “white” could have been orchestrated by the Indian government itself. Notably, Bitcoin and other cryptocurrencies are still not recognized as legal tender in India, even though a finalized draft of crypto regulations by the nation’s authorities is expected to be released soon. Moreover, the nation’s Supreme Court recently supported the Reserve Bank of India’s (RBI) decision to deny banking services to those dealing in digital currencies.