Financial and Business News

$790 Million Alleged Losses Linked to GainBitcoin as CBI Arrests Darwin Labs Co-Founder

Wednesday, 11/03/2026 | 16:46 GMT by Tareq Sikder
  • GainBitcoin scheme affected 8,000 investors, promising 10% monthly Bitcoin returns.
  • Investigators conducted coordinated searches at over 60 locations in February last year.
india-crypto

India’s Central Bureau of Investigation has arrested Ayush Varshney, co-founder and chief technology officer of Darwin Labs Private Limited, in connection with the GainBitcoin cryptocurrency fraud case.

The scheme, one of the largest crypto frauds in India, involved around 8,000 investors and reported losses of about $790 million.

Indian authorities have repeatedly warned that some cryptocurrency investment products could resemble “Ponzi schemes.” In 2019, police arrested four individuals in a separate crypto fraud that defrauded investors of $14 million.

GainBitcoin Platform CTO Detained in India

Varshney was detained at Mumbai airport on Monday while attempting to leave the country. A Look Out Circular had been issued against him, and he was taken into custody on Tuesday for further investigation.

Investigators said Darwin Labs built key technology used in the scheme, including the GainBitcoin investor platform, related payment and wallet systems, and later, the MCAP token and ERC-20 smart contract.

CBI Conducts Coordinated Searches in GainBitcoin Case

GainBitcoin, which began in the mid-2010s as a cloud-mining platform, initially offered fixed Bitcoin returns. It later shifted to a multi-level marketing model, with payouts linked to recruiting new participants, and when deposits slowed, rewards were paid in the lower-value MCAP token.

Darwin Labs also built GBMiners.com, a Bitcoin payment gateway, the Coin Bank wallet, and the GainBitcoin website. Authorities said the scheme was led by Amit Bhardwaj, who died in 2022 while on bail. Coordinated searches at over 60 locations were conducted on February 26, 2025.

India’s Central Bank Upholds Broker Restrictions

The case comes as India’s financial regulators continue tightening oversight of capital markets. India’s central bank confirmed it will not change new lending rules for retail brokers and proprietary traders, effective April 1.

The regulations require banks to back all credit to capital market intermediaries with 100% eligible collateral and prohibit financing of proprietary trading.

The move follows growing scrutiny of retail derivatives trading, where investors have experienced significant losses, and authorities have highlighted potential impacts on liquidity, brokerage operations, and broader market activity. The RBI confirmed no adjustments are planned.

India’s Central Bureau of Investigation has arrested Ayush Varshney, co-founder and chief technology officer of Darwin Labs Private Limited, in connection with the GainBitcoin cryptocurrency fraud case.

The scheme, one of the largest crypto frauds in India, involved around 8,000 investors and reported losses of about $790 million.

Indian authorities have repeatedly warned that some cryptocurrency investment products could resemble “Ponzi schemes.” In 2019, police arrested four individuals in a separate crypto fraud that defrauded investors of $14 million.

GainBitcoin Platform CTO Detained in India

Varshney was detained at Mumbai airport on Monday while attempting to leave the country. A Look Out Circular had been issued against him, and he was taken into custody on Tuesday for further investigation.

Investigators said Darwin Labs built key technology used in the scheme, including the GainBitcoin investor platform, related payment and wallet systems, and later, the MCAP token and ERC-20 smart contract.

CBI Conducts Coordinated Searches in GainBitcoin Case

GainBitcoin, which began in the mid-2010s as a cloud-mining platform, initially offered fixed Bitcoin returns. It later shifted to a multi-level marketing model, with payouts linked to recruiting new participants, and when deposits slowed, rewards were paid in the lower-value MCAP token.

Darwin Labs also built GBMiners.com, a Bitcoin payment gateway, the Coin Bank wallet, and the GainBitcoin website. Authorities said the scheme was led by Amit Bhardwaj, who died in 2022 while on bail. Coordinated searches at over 60 locations were conducted on February 26, 2025.

India’s Central Bank Upholds Broker Restrictions

The case comes as India’s financial regulators continue tightening oversight of capital markets. India’s central bank confirmed it will not change new lending rules for retail brokers and proprietary traders, effective April 1.

The regulations require banks to back all credit to capital market intermediaries with 100% eligible collateral and prohibit financing of proprietary trading.

The move follows growing scrutiny of retail derivatives trading, where investors have experienced significant losses, and authorities have highlighted potential impacts on liquidity, brokerage operations, and broader market activity. The RBI confirmed no adjustments are planned.

Topics
crypto
cryptocurrency
india
Ponzi Scheme
About the Author: Tareq Sikder
Tareq Sikder
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Tareq is a financial writer with 15 years of experience covering global markets. His work spans technical analysis, forex broker reviews, and market sentiment, with a focus on topics relevant to retail traders. He joined Finance Magnates in 2023. At Finance Magnates, he serves as News Editor, covering retail forex and CFD brokers, cryptocurrency exchanges, fintech firms, and regulatory developments shaping the trading industry. He holds an Honours degree in Information Technology from Anfell College, London. Education: Honours degree Information Technology, Anfell College, London

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