Karnataka Bitcoin Scam: Crypto exchange founder paid Rs 7 lakh to police to recover 60.6 BTC stolen in 2017

In July 2017, the cryptocurrency landscape in India was struck by the Karnataka Bitcoin scam, unraveling a web of deceit and corruption that shook the foundations of trust within the digital currency realm. The incident, revolving around the theft of 60.6 Bitcoin valued at Rs 1.14 crore from Unocoin Technologies, has resurfaced with startling revelations, including alleged police involvement and subsequent arrests.

Background of Unocoin Technologies

Unocoin Technologies Pvt Ltd, a pioneer in India's cryptocurrency exchange sector, became embroiled in controversy when its co-founder, Harish B V, reported the theft of a substantial amount of Bitcoin in July 2017. This marked the genesis of a saga that would unfold over the years, exposing the vulnerabilities inherent in the nascent yet rapidly evolving world of digital currencies.

Wow! Karnataka Bitcoin scam takes a surprising turn as the Unocoin Technologies director paid Rs 7 lakh to the police to recover 60.6 BTC stolen in 2017. The alleged value of the stolen Bitcoin was Rs 1.14 crore. #cryptocurrency #BitcoinScam pic.twitter.com/Jo08ePp76F

— Crypto Scam Never (@CryptoScamNever) February 19, 2024

Theft and Police Complaint

Harish B V's police complaint filed in Tumkur unveiled the magnitude of the theft, with the stolen Bitcoin valued at Rs 1.14 crore. The incident sent shockwaves through the cryptocurrency community, highlighting the susceptibility of digital assets to malicious actors.

Recovery Attempt by Co-founder Harish B V

Following the arrest of hacker Srikrishna Ramesh, alias Sriki, in 2020, Harish B V undertook efforts to recover the stolen Bitcoin. Shockingly, it came to light that Harish paid Rs 7 lakh to CCB inspector Prashanth Babu for the purported retrieval of the cryptocurrency.

Involvement of Central Crime Branch (CCB) Inspector Prashanth Babu

The involvement of law enforcement officials added a sinister dimension to the saga, with CCB inspector Prashanth Babu allegedly accepting bribes to facilitate the recovery of the stolen Bitcoin. Such revelations underscored the erosion of trust and integrity within the guardians of law and order.

Arrests and Allegations by SIT

A CID SIT, meticulously probing the Bitcoin scam, unveiled a tangled web of complicity, leading to the arrest of Babu and private cyber expert K S Santhosh Kumar. The FIR lodged by the SIT implicated former CCB officers, further tarnishing the reputation of law enforcement agencies.

Role of Co-founders Sathvik V and Harish B V

Sathvik V and Harish B V, co-founders of Unocoin Technologies, found themselves entangled in the investigation, albeit securing anticipatory bail. Their involvement shed light on the intricate dynamics between cryptocurrency enterprises and law enforcement agencies.

Formation of the Special Investigation Team (SIT)

The establishment of a Special Investigation Team by the Karnataka CID underscored the gravity of the Bitcoin scam, reflecting the authorities' resolve to unearth the truth and hold perpetrators accountable.

Details of the Bitcoin Scam

The modus operandi of the Bitcoin scam, spanning from the initial theft to subsequent recovery attempts, revealed the vulnerabilities inherent in digital currency transactions and the challenges in regulating this burgeoning industry.