Former BJP MLA Nalin Kotadiya has been arrested for an alleged involvement with the kidnapping syndicate of Shailesh Bhatt in Bitcoin extortion case. He was arrested by Ahmedabad Crime Branch Police from Dhuliya district of Maharashtra.
Kotadiya was able to evade his arrest until yesterday. ANI reported his arrest. This development is expected to fast-track the resolution of the particular case where Kotadiya is being indicted as an offender in the Rs 9.95 crore bitcoin extortion case of Surat.
The ex-MLA was declared wanted by the court after failing to turn up for questioning following a summon. The summon was as a result of an application filed by the CID (Crime) with respect to the above-mentioned offence.
Kotadiya, however, claimed innocence over the allegations, claiming that he was being framed. The case in question involves the abduction of Surat-based builder Shailesh Bhatt, and his associate and Kotadiya’s nephew Kirit Paladiya, in a bid to extort bitcoins from him, on February 11. However, investigations revealed the entire exercise to have been orchestrated by Paladiya and had connived with SP Jagdish Patel and others to extort the cryptocurrency from Bhatt and to share the spoils.
This development is one of the common stains on the fabric of bitcoin and cryptocurrencies. The peer-to-peer payment systems have been taken advantage of by criminals in different known cases within the ecosystem. Hackers have also in a number of incidences demanded bitcoin or altcoin as ransom over attacks on premium websites and platforms.
In its current state, however, tracking cryptocurrency inclined financial crimes within the ecosystem may appear complicated, but not totally impossible. This explains one of the reasons why regulators demand KYC compliance from exchanges and their clients. This would largely reduce the extent of anonymity involved in dealing with cryptocurrencies. How this will affect the decentralized characteristics of digital payment systems is, however, another angle that gives rise to the existing debate in the industry.
Despite being indicted, Kotadiya has also alleged that Sailesh Bhatt, the victim the victim, in this case, is involved in an initial kidnapping case involving two investors from whom he extorted 2,300 cryptocurrencies on February 1, 2018.
The arrest is merely the latest twist in the ongoing case and the recent arrest might just be an initial step by the local Indian police towards untangling the intertwined web of issues.