After failing to add money to his crypto wallet on CoinSwitch Kuber app, the complainant raised a query.
A Bengaluru-based rookie crypto trader has lost bitcoins worth Rs 10 lakh to a fraudster who promised to handle his account and provide high returns. The 38-year-old lecturer with a private college in Bengaluru has lodged a complaint with Central CEN Police.
The incident took place on February 22. The complainant recently joined the CoinSwitch Kuber, a crypto trader platform used by many in India, as per a Times of India report.
After failing to add money to his crypto wallet on CoinSwitch Kuber app, the complainant raised a query in one of the cryptocurrency rooms on the Telegram app, which he had joined to learn more about the trading process.
On the Telegram app, a hacker contacted the complainant and assured him of high returns and also offered to handle his crypto account, the report said.
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Subsequently, the complainant shared his login credentials, including the One Time Password (OTP). The hacker then allegedly transferred bitcoins worth Rs 10 lakh to his account.
Many other traders were also facing transaction failures like me, he told the police in a statement.
The Central CEN police has registered a case under multiple sections of the Information Technology Act and Indian Penal Code, the report said.
"If it was about banks, there would be a regulator and banks could be approached. But when it comes to cryptocurrency, there are no regulators as such. We are planning to approach CoinSwitch Kuber to find a solution,” a police officer said.
CoinSwitch was founded in 2017 as a global aggregator of cryptocurrency exchanges. The company launched its India-exclusive crypto platform, CoinSwitch Kuber in June 2020.
Commenting on the incident, CoinSwitch Kuber said it will cooperate with the investigating authorities and provide them all possible assistance.
"It is unfortunate that one of our users has been subjected to fraud by a third party. We will cooperate with the investigating authorities and provide them all possible assistance. We request all our users to be extremely careful in handling their OTPs and account details," the statement said.
"CoinSwitch Kuber credentials are as sacrosanct as one's bank credentials, and hence, they must not be shared with any third party. Users must also note that CoinSwitch Kuber and its representatives will never request for their login credentials. In case of any doubts or queries, users should first email us on email@example.com. These details are also available under the 'Help & Support' section on the CoinSwitch Kuber app," the company said further.
Globally, governments have grown wary of this unregulated asset class, and like a lot of technologies, heavy regulation comes later and then evolves over time.
For years, governments in the US, UK, France and other countries have been looking to crack down on cryptocurrency fraud, with many convinced that it is a bubble and not a legitimate asset class. However, all developed countries have tried regulating it and removing bad actors instead of banning the technology or its applications.