An Indian cryptocurrency trader who amassed a $40 million fortune was kidnapped by a police officer and seven others who demanded he transfer his bitcoin wallet to them, authorities said Wednesday.

Vijay Naik, 38, was abducted in the city of Pune on January 14 and told to hand over his digital fortune, along with 800,000 rupees ($10,700) in cash.

He was abruptly let go the next day when the kidnappers realised the police were on their tail, and the perpetrators were detained on Tuesday.

Among the accused was Dilip Tukaram Khandare, a police officer who had been trained in cybercrime investigations and had come to learn of Naik’s bitcoin holdings.

“We have taken eight people including a police constable who planned the abduction into custody,” a senior officer confirmed to AFP.

The case comes days after the arrest of several other officers accused of kidnapping a man in Jaipur and forcibly transferring $1.2 million in bitcoin from his mobile into another account, local media reports said.

Cryptocurrency remains largely unregulated in India despite burgeoning local trading platforms and glitzy celebrity endorsements attracting millions of new traders.

The burgeoning market was banned in 2018 after a surge in fraudulent transactions but restrictions were lifted by the Supreme Court two years later.

The government this week announced a 30 percent tax on profits from virtual currencies and the introduction of a “digital rupee” backed by India’s central bank. (AFP)

Update news