Raj Kundra Walks Free in Bitcoin Scam Storm as Mumbai Court Grants Bail in ₹150 Crore Crypto Case

Legal Implications of the Raj Kundra Bitcoin Scam Case Update as Mumbai Court Grants Bail

A Mumbai court has granted bail to businessman Raj Kundra in connection with a high profile cryptocurrency fraud investigation linked to the alleged GainBitcoin Ponzi scheme. The decision marks a significant development in what has come to be widely referred to as the Raj Kundra Bitcoin scam case, an investigation involving claims of misappropriated digital assets valued at approximately ₹150 crore.

The ruling, delivered on February 20, 2026, allows Kundra to remain out of custody while legal proceedings continue under India’s Prevention of Money Laundering Act. Although the court found sufficient prima facie material to allow the trial to move forward, it noted that Kundra had cooperated with authorities during the prolonged investigation, which began in 2018.

The case remains one of the most closely watched cryptocurrency related prosecutions in India, highlighting the country’s evolving legal approach to digital asset enforcement.

Background of the GainBitcoin Investigation

The Enforcement Directorate, India’s financial crime investigation agency, has been examining the broader GainBitcoin scheme for several years. Authorities allege that the scheme operated as a Ponzi style investment operation that lured participants with promises of unusually high returns through Bitcoin related mining ventures.

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According to investigators, thousands of investors were allegedly defrauded as the scheme collapsed, leaving significant financial losses in its wake.

Within that broader investigation, authorities have scrutinized the role of several individuals, including Raj Kundra. The central allegation against him involves the receipt of 285 Bitcoins from the scheme’s alleged mastermind, Amit Bhardwaj.

At current market valuations, those 285 Bitcoins are estimated to be worth more than ₹150 crore.

Allegations and Key Investigative Findings

The Enforcement Directorate has alleged that the 285 Bitcoins were intended to fund the development of a cryptocurrency mining facility in Ukraine. However, investigators claim that the proposed mining farm was never established.

According to the agency, multiple aspects of the transaction remain unexplained.

Authorities state that wallet addresses associated with the transferred Bitcoins have not been fully disclosed. Investigators argue that the absence of detailed blockchain tracing information complicates efforts to determine the ultimate destination of the funds.

In addition, the Enforcement Directorate has referenced a signed term sheet that allegedly demonstrates involvement in the mining project arrangement. Officials contend that the document supports the assertion of active participation in the broader financial transaction.

Investigators have also raised concerns about certain property transactions in Mumbai’s Juhu area. The agency is reportedly examining whether flats were sold below market value as part of potential laundering mechanisms.

One of the more controversial elements of the case involves Kundra’s claim that relevant digital information was lost when his iPhone X was damaged. Authorities have expressed skepticism regarding this explanation, suggesting it may have impeded access to potentially important records.

Court’s Reasoning for Granting Bail

While the court determined that the case contains sufficient material to proceed to trial, it granted bail based on several considerations.

Judicial observations indicated that Kundra has cooperated with investigative authorities over the course of the multi year probe. The court noted that continued custody was not deemed necessary at this stage of the proceedings.

The bail was granted on a surety bond of ₹1 lakh. As part of the bail conditions, Kundra is prohibited from leaving India without prior court approval. He must also attend all scheduled hearings as the matter progresses under the Prevention of Money Laundering Act.

Legal experts say the decision reflects a balance between ensuring judicial oversight and respecting procedural rights during lengthy financial investigations.

Public Response and Kundra’s Position

Following the bail order, Kundra addressed reporters outside the courtroom, stating “Satyamev Jayate,” a phrase meaning truth alone triumphs. He has consistently denied wrongdoing and argued that the allegations have been overstated.

His legal team has maintained that the evidence does not substantiate claims of money laundering or criminal intent. Defense counsel is expected to challenge the charges in subsequent hearings and may seek relief from higher courts if necessary.

The case has attracted widespread media attention in India due to both the financial magnitude involved and Kundra’s public profile.

Legal Implications for Cryptocurrency Regulation in India

Beyond the individual prosecution, the Raj Kundra Bitcoin scam case carries broader legal implications for India’s cryptocurrency regulatory environment.

The case demonstrates how existing anti money laundering frameworks are being applied to digital asset transactions. Under the Prevention of Money Laundering Act, authorities have significant investigative powers, including the ability to attach assets suspected of being linked to unlawful activity.

Indian regulators have increasingly emphasized compliance, reporting obligations, and transaction monitoring within the cryptocurrency sector. Exchanges and service providers are now required to adhere to stricter Know Your Customer and Anti Money Laundering standards.

Legal analysts suggest that this case underscores the government’s intention to pursue complex financial investigations involving blockchain assets, even years after the original transactions occurred.

The Role of Blockchain Forensics

A key aspect of the trial will likely involve blockchain forensic analysis. While cryptocurrency transactions are pseudonymous, they are recorded on public ledgers. Investigators can trace movement patterns and link addresses to individuals through supporting evidence.

In large scale financial investigations, blockchain analytics firms often assist law enforcement in mapping digital asset flows across wallets and exchanges.

If prosecutors present technical evidence tracing the disputed Bitcoins, the trial could set important precedents regarding evidentiary standards in crypto related prosecutions.

Conversely, defense counsel may challenge the interpretation of blockchain data, raising questions about attribution, custody, and control of digital wallets.

Potential Impact on Investors and the Crypto Industry

High profile enforcement actions can have ripple effects across the broader digital asset ecosystem. Cases involving alleged fraud often prompt increased regulatory scrutiny and calls for stronger oversight.

For investors, such developments highlight the importance of due diligence and transparency in crypto ventures. Ponzi schemes and fraudulent mining operations have historically exploited investor enthusiasm during periods of rapid price growth.

The Indian government has repeatedly signaled its intent to protect retail investors from financial misconduct within the cryptocurrency sector.

Future Outlook of the Case

The next phase of the Raj Kundra Bitcoin scam case will involve detailed trial proceedings. Prosecutors will aim to establish whether the receipt and handling of the 285 Bitcoins constituted money laundering under Indian law.

The defense is expected to argue that the transactions were legitimate business dealings and that there was no intent to defraud investors.

Given the complexity of cryptocurrency tracing and cross border financial flows, legal proceedings may extend over a considerable period.

Observers note that the case could influence how future cryptocurrency related investigations are structured and prosecuted in India.

Conclusion

The Mumbai court’s decision to grant bail in the Raj Kundra Bitcoin scam case marks a pivotal moment in one of India’s most closely watched cryptocurrency investigations.

While the businessman has been allowed to remain free pending trial, the legal battle is far from over. The allegations involving 285 Bitcoins, an unbuilt mining farm, and potential money laundering transactions will now be examined in detail during formal proceedings.

Beyond the individual case, the matter highlights the growing role of anti money laundering laws in shaping India’s digital asset regulatory landscape.

As the trial unfolds, it may help define how cryptocurrency fraud cases are investigated, prosecuted, and adjudicated in the years ahead.

For continued updates on cryptocurrency regulation and financial crime investigations, visit hokanews.

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Writer @Erlin
Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.
 
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