Indian authorities have launched a massive crackdown on an alleged crypto Ponzi scheme that is said to have caused investors a loss of around $254 million.
The case highlights an increasing global problem. As crypto hacks rise in 2025, instances of fraud are also escalating in parallel. Sophisticated criminals exploit owners of digital assets through advanced and targeted scam tactics.
Indian authorities unveil multi-platform crypto Ponzi scheme
India's Directorate of Enforcement (ED) stated that it conducted raids at eight locations in the states of Himachal Pradesh and Punjab on December 13, according to the Prevention of Money Laundering Act (PMLA). The investigation concerns what authorities describe as a large-scale fraudulent crypto-based Ponzi and multi-level marketing (MLM) scheme, which allegedly defrauded hundreds of thousands of investors.
The ED states that investors lost approximately Rs. 2,300 crore. This amounts to about $254 million at current exchange rates. The scheme is said to have been orchestrated by Subhash Sharma, who fled India in 2023.
"The ED initiated the investigation based on several reported cases registered by various police stations in Himachal Pradesh and Punjab against Subhash Sharma, the main perpetrator behind the fraud, and others involved for violations of various sections of the IPC, 1860 Chit Funds Act, 1982, Banning of Unregulated Deposit Schemes Act, 2019, as well as related legislation," the press release states.
Investigators claim that Sharma and his associates launched and operated these schemes through several platforms. This includes Korvio, Voscrow, DGT, Hypenext, and A-Global. These platforms are described as unregulated, self-defined systems that functioned as classic Ponzi schemes.
"Naive investors were lured with false promises of extraordinary returns," authorities state.
The ED also disclosed that those involved manipulated fictitious token prices. On several occasions, they created, shut down, and renamed platforms to conceal the fraud.
Authorities claim that proceeds from the crimes were laundered through cash collections, shell companies, and private bank accounts belonging to the accused and their relatives.
The press release suggests that several individuals acted as commission agents and earned significant amounts by recruiting new participants into the scheme. The network is also accused of using overseas trips and marketing events to accelerate recruitment and expand operations.
"Despite the issuance of freezing orders on 04.11.2023 from the competent authority (based on investigations by the state police), which were communicated to the Ministry of Finance, the esteemed court, and the authorities in Punjab, 15 plots in Zirakpur, Punjab, were sold by one of the arrested (apprehended by Himachal Pradesh police in 2025), namely Vijay Juneja, in blatant violation of the law," states the ED.
After the raids, the ED confirmed that they froze three bank lockers, bank deposits, and fixed deposit investments worth a total of approximately Rs. 1,2 crore (around $132,000).
"Furthermore, various incriminating documents related to investments in multiple real estate properties, including benami properties acquired by the accused with funds generated from the Ponzi scheme, investor databases, commission structures, as well as digital devices, indicating extensive generation and laundering of such funds, have been seized."
Authorities also state that the investigation is still ongoing.
Global epidemic of crypto fraud is increasing
The action in India comes at a time when there is an increased global scope of crypto fraud. Last month, BeInCrypto reported that fraudsters in Australia forged cybercrime reports and posed as police to steal victims' assets.
Criminal actors are also becoming more strategic in their timing, increasingly starting schemes during holidays when online shopping and digital transactions rise.
It is worth noting that this trend is not a new phenomenon. The FBI's 2024 Internet Crime report recorded over 150,000 complaints related to cryptocurrency.
The losses amounted to $9.3 billion, up 66% from 2023. Investment-related fraud caused damages of $5.8 billion. Furthermore, TRM Labs reports that crypto-related fraud has drained at least $53 billion globally since 2023.
Regulators around the world are tightening enforcement. India's action reflects a broader movement to prosecute fraudsters and recover funds. Challenges remain, however. As crypto becomes more popular, the race between fraudsters and those combating fraud continues.
