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 IndiaVarshney 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.BREAKING: 🇮🇳CBI arrests Ayush Varshney, a key figure in ₹6,000 crore GainBitcoin scam. pic.twitter.com/BlNocj5GVR— Crypto India (@CryptooIndia) March 11, 2026CBI Conducts Coordinated Searches in GainBitcoin CaseGainBitcoin, 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 RestrictionsThe 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. This article was written by Tareq Sikder at www.financemagnates.com.

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