India’s Enforcement Directorate (ED) has launched a money laundering probe into an alleged cryptocurrency investment fraud worth approximately $35 million (over Rs. 300 crore). The case involves Bengaluru-based crypto influencers who are accused of promising discounted token allocations to overseas investors and then failing to deliver.
How the Alleged Scheme Worked
According to the ED, the suspects operated as self-proclaimed crypto ‘key opinion leaders’ and used Telegram, WhatsApp, Instagram, websites, and in-person meetings to lure victims. They claimed to have access to guaranteed, steeply discounted direct token allocations from major blockchain projects such as MultiverseX, Kava, BEAM, GRASS, SUI, VANA, and AGLD. These private placements typically occur before public exchange listings, making the promised discounts attractive to early buyers. The accused allegedly used false credentials and claimed direct ties with blockchain developers to support their offers.
Investigators say the group initially completed smaller deals without issues to build trust before investors transferred larger amounts. Funds were routed through a network of wallets, with large portions traced to suspect Ravindra K in Bengaluru, who is believed to be the operator behind the over-the-counter (OTC) deals. After receiving multi-million-dollar investments, the accused allegedly stopped delivering tokens when crypto prices rose, causing investors to lose access to promised allocations.
ED Actions and Seizures
The ED’s Bengaluru Zonal Office carried out searches on July 18 and 19, seizing digital devices, emails, wallet records, and encrypted account details. Authorities also seized virtual assets worth about 8,700 USDT (Tether stablecoin). The probe began under the Prevention of Money Laundering Act following a complaint from a Dutch commercial entity and an FIR from the South Andaman Cyber Crime Police. Initial losses were estimated at $10 million, but further checks revealed the suspected fraud exceeded $35 million.
Officials say the seized material may help trace how funds moved between wallets and personal accounts, and may identify more victims. The ED is reviewing offshore wallets and related payment records for additional transfers. International cooperation may become necessary as the suspected transactions crossed several countries. The agency continues to examine the full network and seeks to freeze assets connected to the case. No court has convicted the named individuals, and the allegations remain under investigation.