Chinese authorities have arrested 21 people on suspicion of defrauding around 900,000 people of more than 50 billion yuan ($7.6 billion), state media reported, after an online peer-to-peer lender turned out to be a giant Ponzi scheme.

Ezubao offered investors annual returns of between nine percent and 14.6 percent on various projects, the official Xinhua news agency reported - far more than currently offered by Chinese banks' wealth management products.

The platform, launched in July 2014, had amassed more than 50 billion yuan by December, said the report late Sunday, citing police as estimating 900,000 investors had fallen victim to the scam.

Investors were despondent on Monday, with one asking on China's Twitter-like Weibo: “Does our money just evaporate like that?"

But few comments were visible, leading to suspicions of censorship in a country where authorities impose strict controls to avoid social unrest

Illegal fund-raising is widespread in China and often involves a large number of investors who have few investment options because of low bank interest rates, an extremely speculative stock market and uncertainties in the property sector.

Last October a payment crisis at statemanaged Fanya Metals Exchange sparked protests in Beijing and Shanghai, with police detaining hundreds in the capital.