Gujarat Bitcoin Scam: ED Arrests Two Relatives, Probes ₹240-Crore Crypto Laundering Network
According to the investigating agency, initial investigations revealed that both accused were involved in the trafficking of Bitcoin and other cryptocurrencies worth more than ₹240cr.
Published : January 20, 2026 at 11:37 PM IST
Ahmedabad: The Enforcement Directorate (ED) has taken major action in a case involving the illegal trafficking of Bitcoin and other cryptocurrencies worth ₹240 crore. The ED has arrested the nephew of the main accused, Shailesh Bhatt, and a relative of Nalin Kotadia, sending shockwaves through the entire crypto scam.
The accused arrested by the ED include Nikunj Bhatt, Shailesh Bhatt's nephew, and Sanjay Kotadia, a relative of Nalin Kotadia. According to the investigating agency, initial investigations revealed that both accused were involved in the trafficking of Bitcoin and other cryptocurrencies worth more than ₹240 crore.
During the investigation, the ED found that the illegally acquired Bitcoin and crypto assets were concealed, transferred, and diverted through various wallets. The ED has taken action on the grounds that this entire process falls under the purview of money laundering.
The ED had sought a 10-day remand for both accused to conduct a detailed investigation into the illegal movement of Bitcoin and cryptocurrencies. The ED stated that questioning the accused was necessary to access digital evidence, transaction chains, and identify other individuals involved.
ED Special Court, after hearing the arguments of the investigating agency and considering the presentation of the accused in court, granted a 5-day remand. The ED now anticipates further revelations during the custody of the accused.
According to ED officials, more arrests and seizures of crypto assets are likely in this case. The investigation into this multi-crore crypto scam is still ongoing, and more prominent names may surface in the coming days.
Background Of The Case
In 2018, a sensational criminal case emerged in Gujarat, known as the "Bitcoin Extortion Case." This case sparked a serious debate about cryptocurrency-related crimes not only in Gujarat but across the entire country. This case involved serious allegations of kidnapping, extortion, criminal conspiracy, and abuse of power.
Suresh Bhatt, a businessman from Surat, was kidnapped near Gandhinagar in February 2018. It is alleged that some police officers from Amreli district and their associates forcibly abducted Bhatt, held him illegally at various locations, and demanded a ransom of millions of rupees in Bitcoin and cash.
In this case, it is alleged that the kidnappers threatened Shailesh Bhatt and forced him to transfer over 176 Bitcoins. At the time, this amount was worth crores of rupees. The case became even more serious because the ransom was demanded using cryptocurrency.
In 2025, the ACB court convicted 14 accused in the Bitcoin extortion case and sentenced them to life imprisonment. This verdict sent a clear message that no one involved in serious crimes like kidnapping and extortion, regardless of their political or police position, is above the law.
Following the verdict, some of the accused, including Nalin Kotadia, filed an appeal in the Gujarat High Court. During the hearing of the appeal, the High Court temporarily stayed Nalin Kotadia's sentence and granted him bail. The case is currently under appeal, and the final verdict is awaited.
