The Enforcement Directorate (ED) of India has provisionally attached ₹7.02 crore (~$840,000) linked to a large-scale crypto mining scam, marking a significant regulatory enforcement action against fraudulent operations in the sector. The funds, seized from 29 bank accounts on July 24, 2025, stem from the “ShareHash” mobile app scam that lured investors with false promises of cryptocurrency mining profits.
Enforcement Details
Operating under India’s Prevention of Money Laundering Act (PMLA), the ED’s Bengaluru Zonal Office uncovered a network of shell companies—including Cotata Technology Pvt. Ltd. and Siraleen Tech Solutions Pvt. Ltd.—used to launder money. The scam impersonated job-seekers during the COVID-19 pandemic to create fake entities, routing investor funds through payment gateways before converting them to cash or gold. Investigators noted that directors of these companies ignored summonses or denied involvement, complicating recovery efforts. Learn more about Bitcoin transaction validation.
Regulatory Implications
This action signals intensified scrutiny of:
- Compliance: Mandatory KYC/AML protocols for mining operations to prevent identity fraud.
- Investor Risks: Highlighting vulnerabilities in “guaranteed return” mining schemes.
- Industry Impact: Legitimate miners may face heightened due diligence requirements.
The ED’s move aligns with India’s broader crackdown on unregulated crypto activities, emphasizing that fraud posing as mining operations will trigger aggressive asset seizures under existing financial regulations.
Broader Industry Consequences
While targeting illicit operations, this enforcement could accelerate formalization in India’s mining sector. Legitimate firms may benefit from reduced fraudulent competition but must navigate stricter oversight. The case also exposes jurisdictional challenges; despite India lacking comprehensive crypto legislation, authorities are leveraging traditional financial crime laws to police the digital asset space.
“This enforcement underscores regulatory patience for Ponzi schemes masquerading as mining ventures has evaporated,” noted a financial compliance analyst familiar with the case. For a detailed look at mining costs in 2025, view this comprehensive analysis.
