Founders of Indian Cryptocurrency Exchange Granted Anticipatory Bail in Alleged Theft Case
The founders of Unocoin Technologies Pvt Ltd, one of India’s earliest cryptocurrency exchanges, have been granted anticipatory bail by a special court in Bengaluru. Sathvik V and Harish BV approached the court after receiving notices from the special investigation team (SIT) following the arrest of a private cyber expert and a police officer. The SIT is investigating the alleged theft of cryptocurrency from an international hacker, Srikrishna Ramesh alias Sriki, who was arrested in November 2020.
The court granted conditional anticipatory bail to the duo on a surety of Rs 2 lakh each. They have been directed to appear before the SIT within 15 days and cooperate with the investigation. Leaving the country without the court’s permission is prohibited. The founders argued in their bail plea that they were not named as accused persons in the complaint registered by the SIT officer and expressed fear of being arrested due to the summoning.
Accused Officers Allegedly Deleted Evidence in Bitcoin Wallet Hacking Case
According to the SIT, the arrested police officer illegally accessed the Amazon Web Server wallet files of Sriki and did not record the details of the accessed wallets as evidence. The officer allegedly used private cyber experts to delete the bash history on the server and destroy evidence. The SIT claims that crucial information on the Bitcoin wallets was erased as a result. The founders of Unocoin Technologies have denied being involved in the destruction of evidence and are willing to cooperate with the probe.
Co-founders Paid Police Officer to Recover Hacked Bitcoins
The SIT found that one of the co-founders paid Rs 7 lakh to the arrested police officer to recover Bitcoins that had been hacked and stolen from their exchange by Sriki. The SIT also argued that one of the co-founders monitored Sriki while he was hacking websites at the instance of a police officer at the office of a private cyber expert following Sriki’s arrest in November 2020.
Former Bengaluru Crime Branch Officers Named in FIR
The SIT named three former Bengaluru crime branch officers in the FIR filed on January 24. The officers are accused of illegal confinement of the hacker and his accountant, breach of trust by a public servant, and destruction of evidence. One of the officers has applied for interim anticipatory bail. The SIT is investigating a Bitcoin scam dating back to the period when the BJP was in power in Karnataka, on allegations of large-scale corruption by police and politicians.
Allegations of Forceful Seizure of Bitcoins by Police Officers
The hacker Sriki, who is accused in multiple hacking cases, has claimed in statements given to the police that he was forced by police officers to relinquish Bitcoins when he was arrested. The SIT has obtained voluntary statements from the hacker during the investigation into alleged corruption and wrongdoing following his arrest.
Overall, the founders of Unocoin Technologies have been granted anticipatory bail, while the SIT continues to investigate the alleged theft of cryptocurrency and the involvement of law enforcement officials in the case. The court’s decision provides temporary relief for the founders, who have expressed their willingness to cooperate with the probe.
Analyst comment
The news can be seen as negative for the cryptocurrency market in India as it highlights allegations of theft, illegal activities, and corruption involving crypto exchanges, police officers, and hackers. The ongoing investigation and the named individuals could potentially create a negative perception of the cryptocurrency industry in the country. This could lead to increased scrutiny and regulation, impacting the market’s growth and investor confidence.
