India’s Central Bureau of Investigation has arrested a key accused in the multi-thousand-crore GainBitcoin cryptocurrency fraud case, marking a significant development in one of the country’s most high-profile crypto-related investigations.
In a statement released on March 11, the CBI confirmed the arrest of Ayush Varshney, co-founder and chief technology officer of Darwin Labs Private Limited. Authorities allege that Varshney played a major role in the development and deployment of digital infrastructure used to support the fraudulent scheme.
The investigation centers on the alleged GainBitcoin Ponzi scheme, originally floated by Variabletech Pte. Ltd.. According to investigators, the scheme promised investors unusually high returns through cryptocurrency investments, attracting large sums of money from participants across India.
CBI officials said that funds collected from investors were subsequently misappropriated. The case is being investigated under multiple sections of the Indian Penal Code, including charges related to cheating and criminal conspiracy, as well as provisions under the Information Technology Act, 2000.
Authorities allege that Darwin Labs and its co-founders, including Varshney, Sahil Bagla, and Nikunj Jain, were involved in the development of key components of the ecosystem supporting the fraudulent operation.
According to investigators, the company helped create and deploy the crypto token known as MCAP along with an ERC-20 smart contract.
Darwin Labs was also allegedly involved in building parts of the broader digital infrastructure behind the scheme, including Bitcoin mining pool platforms, payment gateways, wallet systems, and investor-facing websites associated with GainBitcoin.
The arrest followed a Look Out Circular (LOC) issued against Varshney after he was accused of absconding during the investigation. Immigration authorities intercepted him at Chhatrapati Shivaji Maharaj International Airport in Mumbai on March 9 while he was allegedly attempting to leave the country.
He was subsequently handed over to the CBI and formally arrested on March 10.
The GainBitcoin case has been under investigation following a directive from the Supreme Court of India, which ordered the CBI to probe multiple first information reports (FIRs) linked to the alleged crypto fraud. Authorities said the investigation remains ongoing.
