Businessman and a legendary pornstar implicated in a $300M Bitcoin scam

There has been a long upstanding debate in India about celebrities being held liable for the brands they endorse, and some of them are now learning their lesson the hard way.

Enforcement Directorate (ED), the intelligence agency responsible for fighting economic crimes in India, is questioning several celebrities with regards to their involvement in a $300 million cryptocurrency scam , led by now-imprisoned entrepreneur Amit Bharadwaj.

Bhardwaj founded a series of Bitcoin mining firms such as Gain Bitcoin, GB Miners, and MCAP, promising a 10 times return for investors. Needless to say, none of these exuberant high-return promises panned out; instead, investors ended up losing money.

Bhardwaj was arrested in April by Indian police and has been under custody since then. After interrogating him, police is now reportedly questioning people associated with him and his companies.

The first to fall under ED’s radar is the British businessman Raj Kundra (who does most of his business in India). Kundra was questioned for eight continuous hours by ED on Tuesday, local outlet Times of India reports .

ED found several transactions made between Bharadwaj and one of Kundra’s firms prompting them to investigate further.

Kundra has however denied all allegations of being involved in the scam. He told TOI:

Another Indian news channel reported the questioning of Kundra subsequently led to more celebrities, who purportedly promoted GBMiners at various events in Dubai and Singapore. The most prominent name on the list is Sunny Leone, the adult film star turned Bollywood actress.

The rest of the list also features film actresses that any Bollywood fan can recognize in a jiffy: Prachi Desai, Aarti Chabria, Sonal Chauhan, Karishma Tanna, Zareen Khan, Neha Dhupia, Huma Qureshi, Nargis Fakhri, and Kundra’s wife Shilpa Shetty.

However, it appears none of the celebrities have been indicted in the scam so far, according to local media. They are being questioned about their promotional activities in relation to Bharadwaj’s companies.

This is not the first time that celebrities are getting in trouble for promoting cryptocurrency projects or initial coin offerings (ICOs) that prove to be fraudulent — Floyd Mayweather, DJ Khaled, and Steven Seagal have all been there .

The US Securities and Exchange Commission (SEC) even issued a warning against celebrity-backed ICOs last December, noting that such sponsored endorsements are illegal if the celebrity fails to disclose their relationship (or stake) with the cryptocurrency.

It seems India could benefit from similar legislation.

Research: Only 10% of Bitcoin Cash (BCH) is used for transactions

When Bitcoin Cash (BCH) – a hard fork of the world’s apex cryptocurrency Bitcoin (BTC) – first took off last August, it promised to solve BTC’s soaring transaction fees and make cryptocurrencies a viable option for everyday transfers once more. But it appears hardly anyone is using it for its so-intended purpose.

A new study by blockchain intelligence firm Chainanalysis suggests that most cryptocurrency enthusiasts still use BCH for investment purposes a lot more regularly than for transactions. Indeed, the amount of BCH held in wallets is 10 times higher than the amount of BCH used in transactions.

In comparison, the amount of Bitcoin held for investment is equal to the amount held for transactions and speculations.

For the purpose of the research, Chainalysis divided the total supply of Bitcoin and Bitcoin Cash into ‘ monetary aggregates ’ – or broad categories that measure the money supply in an economy – based on liquidity.

The four categories included speculative coins (which tend to be frequently moved between addresses in small amounts), service transactional coins (held by services such as cryptocurrency exchanges and liquidity platforms to facilitate transactions), investment coins (held in large numbers in individual wallets for an extended period of time), and lost and unmined coins (which can’t be accessed by anyone).

Researchers further studied Bitcoin Cash by dividing its money supply into the same aforementioned monetary aggregates — and found only 1.5 million BCH coins to be held for speculation and transactions, the rest being long-term investments.

Coinalysis concludes that while the ratio for Bitcoin between transactions and investments is almost one to one, for Bitcoin it is 1:10. In other words, 90 percent of all Bitcoin Cash is hardly ever used for transactions.

It is also worth noting that these statistics have undergone some drastic changes since late last year.

Since December 2017, a large number of investors have sold their Bitcoin in the market, leading to its increased use for transactions. For Bitcoin Cash, it seems to be the other way around. While up to 15 percent of BCH was with exchanges and other liquidity services in November 2017, it now seems to have moved on to large investors who are holding on to it.

For the record, Chainalysis is a blockchain research firm that investigates cryptocurrency money laundering, fraud, and compliance violations. The firm is most well-known for helping discover the Mt.Gox theft.

Those interested can view the entire research and methodology on Chainalysis website here .

Google is tempting Italian university students with cryptocurrency lectures

Google has cooked up an interesting new strategy to lure talent in to its university recruitment events: talking to students about cryptocurrency and blockchain.

The search engine titan will be hosting a talk on the “Fundamentals and Some Recent Innovations in Crypto-Currencies” at the Polytechnic University of Milan in Italy. The lecture is scheduled to take place on March 8 and will preface the company’s two-day recruitment event , where Googlers will share details about the company and its hiring process.

We spoke with representatives of the Polytechnic University of Milan who confirmed to TNW that the event is indeed official and organized by Google.

“ Bitcoin, Ethereum, Monero, Litecoin… Many crypto-currencies have been in the news lately and most people know they can [be] purchased as an asset or exchanged as currency,” the description for the talk reads. “Less well known is how they really work.”

“In this talk, I’ll review the basic differences between the most popular ones and highlight some interesting innovations in the space, including scripting, privacy and reducing electricity requirements to protect the environment,” it continues. “The talk will be followed by a description of Google jobs and internships and an overview of our interview and hiring process.”

Unfortunately, the website does not state who will be hosting the announced “Fundamentals and Some Recent Innovations in Crypto-Currencies” talk at Politecnico di Milano.

The phrasing, though, strongly suggests that the talk will be given by a Googler.

We have reached out to Google for further clarification and will update this piece accordingly if we hear back.

Those interested to learn more about the event can check out the event page here or peruse the full program here . Anyone interested can sign up for the event by filling in this Google form. The company is also asking those interested to share their CVs, as well as LinkedIn and GitHub profiles.

It is not all that surprising that the internet giant is targeting potential hires with cryptocurrency-themed events.

Indeed, The New York Times reported earlier in February that blockchain-related courses are swiftly picking up steam on campuses around the US. Among others, Carnegie Mellon, Cornell, Duke, the Massachusetts Institute of Technology and the University of Maryland offered graduate-level courses in blockchain and crypto.

One thing I can tell you for sure though: there are worse ways to appeal to university students – ask Microsoft about it .