Key Highlights
- The Delhi court granted bail to Ayush Varshney, noting no evidence shows he directly received investor funds.
- The Central Bureau of Investigation argued he was the “technical brain” behind the MCAP token and mining infrastructure.
- The court highlighted delays in arrest and said the accused had “ample time of nine years” to tamper with evidence if he intended to.
The Delhi court on Tuesday granted bail to Ayush Varshney, the IIT Kanpur graduate arrested last month in connection with the GainBitcoin cryptocurrency fraud case, observing that there is no material on record to show he directly received investor funds.
Varshney, Co-Founder and Chief Technology Officer (CTO) of Darwin Labs Private Limited, was arrested by the Central Bureau of Investigation (CBI) on March 10, in ₹6,000 crore (~$720 million) GainBitcoin scam. He had been stopped a day earlier at Mumbai airport while attempting to leave the country after a Look Out Circular (LOC) was issued against him.
Allowing the bail plea, the court said the seriousness of the allegations cannot by itself justify continued custody. It reiterated that bail is meant to secure the presence of the accused during trial, not to punish.
The court also took note of the delay in his arrest and his appearances before the Enforcement Directorate (ED), where he joined the probe on five occasions. This, it said, did not indicate any intention to evade the process.
Crucially, the court recorded that there is no concrete evidence showing that Varshney handled or received money from investors linked to the alleged fraud.
What the agency told the court
The CBI opposed the bail and argued that Varshney played a central role in building the technical backbone of the scheme.
It described him as the “technical brain” behind the MCAP token and the GBminers mining pool, which investigators claim were used within the structure of the fraud.
“During the period of police custody, the accused did not cooperate with the investigation and deliberately withheld vital information, including details regarding the whereabouts of co-accused persons and possible stashes of the defrauded cryptocurrency,” the agency told the court, as per a report from the Indian Express.
The CBI also raised concerns about electronic evidence and the possibility of it being affected.
What the defence argued
The defence took a narrower line. It said Varshney was a developer, not an operator.
According to his counsel, the investment scheme itself was run by Amit Bhardwaj through Variabletech Pte Ltd and its website gainbitcoin.com. Varshney’s role, they argued, was limited to building parts of the tech stack.
These included the G B Miners software, elements linked to the M Cap cryptocurrency, the Bitcoin Growth Fund, and the Coin Bank E-wallet.
The court also noted that the investment operations tied to GainBitcoin had started before Darwin Labs developed the mining-related software.
In one of its sharper observations, the court said that if Varshney intended to tamper with evidence, he had “ample time of nine years” to do so before his arrest.
The case, going back to 2017
The GainBitcoin case goes back to early 2017, when the scheme was pitched as a Bitcoin investment plan promising returns of up to 10% a month.
It was marketed aggressively. Newspaper ads, online campaigns, videos, social media pushes, the works. For many, it looked like a legitimate crypto opportunity at a time when regulation was still unclear.
Investigators say that when payouts became difficult, investors were issued 100,000,000 MCAP tokens instead. These were later described as “worthless” and, according to the agencies, were used to avoid repayment.
The scheme has since been treated as a Ponzi structure affecting thousands of investors across states.
The death of Amit Bhardwaj in 2022 left the case without its central figure, but investigations continued, focusing on others linked to the ecosystem.
Who is Ayush Varshney
Varshney is a 2014 BTech graduate in Electrical Engineering from IIT Kanpur.
His profile, as presented in court, includes early academic achievements such as topping Science and Cyber Olympiads and receiving scholarships. He later worked across startups, including Grexa AI, Bluegape, Nash Ventures, and Testbook in engineering and product roles.
He was also featured in Forbes “30 Under 30”, a detail his defence pointed to while arguing his professional background.
What this order changes
This is not an acquittal. The case continues.
But the court has drawn a line on what is currently on record, especially on the absence of a direct money trail to Varshney and the long gap before his arrest.
For a case that has dragged for years, that observation could matter as proceedings move ahead.
Also Read: India’s Tax Dept Begins Issuing Section 148A Notices to Crypto Investors
