India’s Gujarat CID Busts ₹200 Crore Crypto Fraud Racket with Pakistan Links

Gujarat’s CID Crime unit has delivered a staggering blow to a cross-border cybercrime syndicate, uncovering a ₹200 crore cryptocurrency laundering operation with direct ties to Pakistan-based wallets. This massive bust, involving mule bank accounts and digital assets like USDT (Tether), lays bare the sinister side of crypto misuse while igniting critical debates about security, regulation, and the future of digital finance in India.

• Huge Crackdown: Gujarat CID exposes ₹200 crore crypto laundering scheme linked to Pakistan and Dubai.
• Central Figure: Chetan Gangani arrested for transferring ₹10 crore via BitGet to a Pakistani wallet.
• National Scope: Network connected to 386 cybercrime cases across India, spanning digital arrests to investment frauds.

The Gujarat CID Bust: Unpacking the ₹200 Crore Racket

In a sweeping operation, Gujarat’s CID Crime unit has dismantled a sophisticated cybercrime network that funneled over ₹200 crore to cybercriminals based in Dubai, with financial trails leading straight to Pakistan. At the center of this scandal is Chetan Gangani, a Surat resident nabbed for transferring ₹10 crore through his account on BitGet—a cryptocurrency exchange platform where users can trade digital assets, often with minimal identity verification—to a Pakistan-based wallet. Gangani, earning a pitiful 0.10% commission per USDT transaction, was a small but crucial player in a much larger game. This syndicate operated through nearly 100 mule bank accounts—accounts often opened with fake or stolen identities to mask illicit transfers—and is linked to a staggering 386 cybercrime cases across India. These scams include digital arrest frauds, where victims are intimidated into paying under fake legal threats, as well as task frauds, online loan cons, and deceptive investment schemes promising sky-high returns. For detailed insights into this operation, check out the report on Gujarat CID’s bust of a massive crypto racket linked to Pakistan.

Investigators traced a total of ₹29 crore to the Pakistan-based wallet, with ₹10 crore originating from Gujarat alone and over ₹25 crore from various Indian sources routed through a Binance USDT account. For the uninitiated, USDT, or Tether, is a stablecoin pegged to the US dollar, designed to maintain a steady value unlike volatile cryptocurrencies like Bitcoin. Its appeal in trading—and unfortunately, in crime—lies in this stability, coupled with the pseudonymity of blockchain transactions, making it a go-to for moving money across borders with little oversight. Gujarat Deputy Chief Minister Harsh Sanghavi, who oversees the Home portfolio, pulled no punches in his announcement of the bust.

“In a major breakthrough, the Gujarat Cyber Crime Center of Excellence has dismantled a large-scale ‘Mule Account’ network operating across multiple districts, Morbi, Surendranagar, Surat, and Savarkundla, with direct financial links traced to Pakistan,” Sanghavi declared. He further noted, “This gang was one of the major contributors [to transferring ₹10 crore to a Pakistani Binance USDT account].”

Police sources elaborated on Gangani’s role, stating, “The Pakistan-based wallet had about ₹29 crore in total, of which ₹10 crore originated from Gujarat. Gangani received a 0.10% commission on every USDT transaction.” Yet, authorities warn this is merely the surface of a deeper problem. They describe the operation as “the tip of the iceberg,” with probes ongoing into hundreds of connected bank accounts and crypto wallets exploiting Indians nationwide. Tracking these funds is no easy feat—investigators peeled back seven layers of transactions, akin to unraveling an onion, where each layer represents a new account or wallet designed to obscure the money’s origin. It’s a maze with no clear exit, especially when funds cross borders into jurisdictions with limited cooperation.

Victims of Crypto Fraud: Real Stories, Real Losses

Beyond the headline numbers, Gujarat is grappling with a surge in standalone cryptocurrency scams in India, often orchestrated through social media platforms like Facebook and messaging apps like Telegram. These aren’t just statistics—they devastate real lives. Take Bunty Kanaiyalal Sangtani, a businessman in Ahmedabad who, on October 28, lost ₹2.05 crore to a fake USDT investment scheme run by a fraudulent outfit called Doxy. Earlier, on October 10, Kishor Nargundkar from Gandhidham was swindled out of ₹56.47 lakh in a Telegram-based scam tied to a sham entity named Conforge Finance. Just days before that, on October 8, Hardik Umraniya, a medical representative in Rajkot, fell prey to a similar USDT scam initiated via Facebook, losing ₹31.5 lakh. These individuals, lured by promises of quick wealth, represent a broader trend of cybercriminals preying on the hype surrounding digital assets.

Picture this: a hardworking shop owner scrolling through Facebook, stumbling upon an ad promising 20% returns on a “safe” crypto investment. A few clicks later, he’s in a Telegram group, wired ₹2 crore to a stranger, and then—poof—radio silence. That’s the harsh reality for many in Gujarat, where the borderless nature of crypto meets the boundless greed of scammers. Social media has become a breeding ground for such frauds, not just in India but globally, as platforms struggle to police fake accounts and misleading ads.

Cryptocurrency as a Double-Edged Sword

Let’s be brutally honest: cryptocurrency is a tool, and like any tool, it can build or destroy. The Gujarat bust highlights how assets like USDT are exploited to obscure money trails. Unlike Bitcoin, where transactions are recorded on a public blockchain for anyone to audit, USDT operates with a veneer of centralization—issued by Tether Limited, a company with past controversies over whether it truly holds the dollar reserves to back each token. This opacity, combined with the speed of cross-border transfers, makes it a darling for laundering. Think of it as sending cash through a network of anonymous mailboxes across countries—good luck tracing the sender.

But let’s flip the script: the tech isn’t the enemy. Bitcoin, with its transparent ledger, is rarely the culprit in these scams—most frauds leverage stablecoins like USDT or shady altcoins because they’re easier to manipulate or obscure. The real issue is human vulnerability—ignorance of how crypto works, greed for quick gains, and the regulatory gray zones that scammers exploit. As Bitcoin maximalists, we’d argue BTC’s ethos as sound, decentralized money remains untarnished by these cons. Yet, we can’t deny that altcoins and platforms like Ethereum, with their smart contract innovations, fill niches Bitcoin doesn’t touch. DeFi protocols and tokenized assets have their place, even if they’re sometimes a playground for rug pulls and frauds. The challenge is separating the wheat from the chaff without torching the whole field.

India’s Crypto Conundrum: Regulation vs. Innovation

India’s relationship with cryptocurrency is a messy love-hate affair. On one hand, the government is pushing a ₹518 crore initiative to nurture blockchain startups, recognizing the tech’s potential to revolutionize finance, supply chains, and governance. On the other, stories like the Gujarat racket fuel calls for tighter control. India already imposes a punishing 30% tax on crypto gains and a 1% transaction levy, while whispers of outright bans or a central bank digital currency (CBDC) loom large. These scams could tip the scales toward harsher measures, eroding public trust faster than a hacked exchange.

Globally, crypto crime isn’t unique to India. Chainalysis reports estimate that illicit transactions accounted for over $14 billion in crypto movements last year, from ransomware payments to money laundering. The Gujarat case, though massive at ₹200 crore, is a drop in that ocean. But here’s the counterpoint: overregulation risks driving crypto underground, making scams harder to track as users flee to unmonitored platforms. Look at China’s blanket ban—did it stop crypto activity? Nope, it just pushed it into the shadows. India must tread carefully, balancing the need to nail bad actors with preserving the freedom that makes blockchain revolutionary. Smother the tech, and you smother innovation. Let it run wild, and you get more Gujarats. It’s a tightrope walk with no safety net.

Fighting Back: Solutions Beyond Crackdowns

Gujarat CID’s efforts are commendable—tracking money through seven transaction layers and busting mule account networks shows grit. Authorities are also urging citizens to avoid unsolicited investment offers, especially those peddled through shady Telegram groups or glossy social media ads, and to report suspicious activities via the National Cyber Crime Reporting Portal at cybercrime.gov.in. But crackdowns alone won’t cut it. Education is the first line of defense. Users must learn to spot red flags: promises of guaranteed returns, pressure to act fast, or requests to send funds to unverified wallets. If it smells like a scam, it probably is.

Practical steps can help too. Always check if a platform or investment scheme is registered with local regulators before parting with your money. Use hardware wallets to store crypto securely, away from exchange hacks. Leverage blockchain analytics tools—many are free for basic use—to trace wallet addresses before sending funds. Exchanges like Binance and BitGet must also step up, tightening KYC (Know Your Customer) checks to weed out mule accounts. Law enforcement partnerships with these platforms can flag suspicious activity faster. Community-driven initiatives, like crypto forums and X threads calling out scams, are another powerful tool. And let’s not forget personal responsibility—don’t chase moonshot gains without due diligence. As much as we champion decentralization, freedom doesn’t mean recklessness.

The Road Ahead for Crypto in India

The Gujarat CID bust is a win, but it’s also a harsh reality check. Cryptocurrency’s promise of financial sovereignty and disruption of outdated systems is real, yet so is its dark underbelly. Bitcoin remains the gold standard for sound money—its public ledger and limited supply make it less prone to the abuses seen with USDT or obscure altcoins. Still, we can’t ignore that other blockchains, like Ethereum, drive innovation in areas Bitcoin doesn’t touch, from decentralized finance to NFTs, even if they come with their own risks. The fight isn’t just against scammers; it’s against ignorance and knee-jerk regulatory overreach that could strangle this revolution before it matures.

India stands at a crossroads. Will it harness crypto’s potential to empower millions, or let a few bad actors define its future? The answer lies in smarter frameworks—targeted policies that punish fraud without punishing progress—and in equipping users with the knowledge to navigate this space safely. No nonsense, no shilling: if we want crypto to be the future of money, we’ve got to clean up the present. Scammers beware—the community is watching, and we’re not buying your bullshit.

Key Takeaways and Questions for Reflection

• How massive is the cybercrime network uncovered by Gujarat CID?
  It’s enormous, laundering ₹200 crore via nearly 100 mule accounts, tied to 386 cases across India, with funds traced to Pakistan and Dubai.
• Why is cryptocurrency often misused in scams like this?
  Assets like USDT offer pseudonymity and fast cross-border transfers, ideal for hiding money trails, while fake investment schemes prey on victims with promises of easy profits.
• Who are the victims of these crypto frauds in Gujarat?
  A diverse group, from businessmen to everyday workers, losing between ₹31.5 lakh and ₹2.05 crore, often targeted through social media and Telegram.
• What measures are authorities taking against these crimes?
  Gujarat CID is tracing complex transaction layers, arresting figures like Chetan Gangani, and encouraging reporting via cybercrime.gov.in to build public awareness.
• How might these scams affect cryptocurrency adoption in India?
  They risk damaging trust and inviting stricter regulations, potentially stalling adoption, even as India invests in blockchain innovation through major initiatives.
• What can individuals do to protect themselves from crypto scams?
  Educate yourself on red flags, verify platforms before investing, use secure wallets, and rely on community resources to flag suspicious activity.