India’s financial crimes agency has turned its attention to the country’s biggest crypto exchanges — and the allegations read like a tour of everything regulators worry about when money moves across borders on a blockchain.
The Enforcement Directorate (ED) said it searched three premises in Bengaluru on November 4 and 5 linked to Neblio Technologies, which operates CoinDCX, and Excelium Technologies, which runs Delta Exchange India. The searches were carried out under Section 37 of the Foreign Exchange Management Act (FEMA), the 1999 law that governs how money moves in and out of the country. The agency says the exchanges routed customer trades through foreign platforms without authorization, and it put the volume of the flows at tens of billions of rupees each.
Three routes abroad, according to the agency
The ED described three ways it says CoinDCX moved customer money offshore. On spot trades, it alleged the exchange converted customers’ rupees into USDT and sent the stablecoin to foreign exchanges — including Binance, KuCoin and Gate.io — to fill the orders. In futures and options, it said CoinDCX mirrored each customer’s position one-for-one on a foreign platform, opening and closing a matching trade abroad whenever the customer did. And tokenized shares of US companies such as Apple, Google and Tesla were, in the agency’s account, really derivatives trading on Hyperliquid, a foreign decentralized platform.
The agency also alleged the trades ran through an account in the name of a Costa Rica-based entity that it described as a paper entity, and that CoinDCX keeps enterprise trading accounts on foreign platforms where it holds crypto assets — in both cases, it said, in breach of FEMA. It added that CoinDCX pays billions of rupees in transaction fees to those platforms, recorded as business expenses, and that routing those payments in stablecoins also contravenes the framework.
Delta Exchange India, meanwhile, offers the same menu — spot, futures and options, and tokenized foreign shares — and the ED said a large part of its derivatives and tokenized-stock trading was actually routed through CoinDCX, which then executed the trades overseas. The agency put those cross-border transactions at several tens of billions of rupees, and said it is also investigating billions of rupees that Delta allegedly sent to associate entities abroad.
What the exchanges say
Both exchanges say business is normal. CoinDCX said ED officials visited its Bengaluru office on November 4 as part of a routine inquiry, that it cooperated fully, and that it operates “in strict compliance with all applicable Indian laws, including FEMA (1999),” as well as its KYC, anti-money laundering and reporting obligations. Trading, deposits and withdrawals remain fully operational, it said.
Delta Exchange India acknowledged the visits, said it is operating as usual, and denied the core allegation: “our business does not involve any cross-border transfer of VDAs in any form or manner.” It added that user funds remain in Indian banks and that it has been registered with India’s Financial Intelligence Unit as a reporting entity since 2023.
The ED said the products offered by the two exchanges also appear to contravene norms under the Securities Contracts (Regulation) Act of 1956, the SEBI Act of 1992 and the RBI Act of 1934, and that further investigation is under way. No formal charges have been made public. The searches are an investigative step, not a verdict — but they are also part of a wider sweep: in late October, the agency searched premises linked to Mudrex and Saber Money in a related inquiry.
CoinDCX is India’s largest crypto exchange by trading volume, even if that volume — roughly $700,000 in 24 hours, according to CoinGecko — is a rounding error next to its global peers. The size of the exchange matters less than the precedent: if the ED’s reading of FEMA holds, the offshore plumbing that Indian platforms have quietly relied on for years may have to be rebuilt in the open.
The Bit Take: India’s message to its crypto exchanges is simple: if your customers’ rupees end up as USDT on a foreign exchange, the paperwork had better exist. CoinDCX and Delta say it does. The Enforcement Directorate says it doesn’t. The trades keep running while the two sides argue — which is exactly how these stories usually go until they don’t.
Sources: CoinDesk, “India’s ED raids CoinDCX and Delta over alleged illegal cross-border trades” (2026-11-12); Moneycontrol, “Why CoinDCX, Delta Exchange have drawn ED’s scrutiny for offering Futures, tokenised US stocks” (2026-11-10); Inc42, “ED Searches CoinDCX Over Alleged Illegal Cross-Border Transfers” (2026-11-07).
