BENGALURU — The Enforcement Directorate (ED) has searched three premises in Bengaluru linked to two of India's best-known crypto trading platforms, CoinDCX and Delta Exchange India, over alleged large-scale unauthorised cross-border transactions in crypto derivatives and tokenised foreign stocks, the agency said in a statement on Friday, November 6. The searches were carried out on November 4 and 5 by the ED's Bengaluru Zonal Office under Section 37 of the Foreign Exchange Management Act (FEMA), 1999. All of the agency's claims are allegations at the investigation stage; no court has ruled on them.
Source: Inc42, reporting the ED statement
The premises searched are linked to Neblio Technologies Private Limited, which operates CoinDCX, and Excelium Technologies Private Limited, which operates Delta Exchange India, according to the ED. The agency said it opened the probe after receiving information about alleged foreign-exchange violations by the two platforms.
Source: Outlook Money, reporting the ED statement
What the ED alleges
The ED alleged that both platforms facilitated spot trading, futures and options (F&O) trading and trading in tokenised shares of foreign companies — all through cryptocurrencies — despite not being authorised to offer such products, and that the transactions in each line ran into thousands of crores of rupees. The agency said the products offered by the two exchanges appear, prima facie, to contravene the Securities Contracts (Regulation) Act, 1956, the SEBI Act, 1992 and the RBI Act, 1934.
Source: Exchange4Media, reporting the ED statement
Describing the alleged method used for CoinDCX spot trades, the ED alleged that users' rupee deposits were converted into the stablecoin USDT and sent abroad through an account held in the name of a Costa Rica-based entity — which the agency called a mere 'paper entity' — to foreign platforms including Binance, KuCoin, Bybit and Gate.io, with the trades in fact executed through CoinDCX's own systems. For futures and options, the agency alleged, CoinDCX opened matching positions on foreign platforms after users placed orders, with settlements completed overseas; tokenised-stock trades were allegedly routed through Hyperliquid, an overseas decentralised trading platform. The ED further alleged that CoinDCX paid hundreds of crores of rupees in transaction fees to foreign platforms in stablecoins.
Source: Inc42, reporting the ED statement
For Delta Exchange India, the ED alleged that a large volume of its derivatives and tokenised-stock transactions was routed through CoinDCX, which in turn executed them on foreign platforms, and that Delta also transferred hundreds of crores of rupees to overseas associate entities — transfers the agency said are under investigation.
Source: Inc42, reporting the ED statement
What the platforms say
Delta Exchange India said it cooperated fully with the officials during the November 4–5 visit and furnished the information sought. In a post on X, the exchange stated that it is not involved in 'any cross-border transfer of VDAs (virtual digital assets) in any form or manner', and said its operations continued normally. CoinDCX had not issued a statement on the searches in the reports published so far.
Source: Inc42, reporting the ED statement
Part of a wider crypto-FEMA clampdown
The searches are the latest step in the ED's broader action against alleged forex violations routed through crypto platforms. Days earlier, the directorate searched premises linked to Mudrex and Saber.money, and the decentralised-finance protocol Instadapp and its platform Fluid, in a separate probe into alleged unauthorised cross-border transfers — a different case from the CoinDCX–Delta action, involving different companies. The ED said further investigation in the CoinDCX–Delta case is under progress.