India’s Enforcement Directorate has searched sites linked to two of the country’s crypto exchanges, CoinDCX and Delta Exchange India. The agency is investigating alleged unauthorized cross-border transactions and violations of foreign-exchange law.
What the ED says it found
The searches were conducted on November 4 and 5, 2026, at three locations in Bengaluru. They targeted Neblio Technologies, the company behind CoinDCX, and Excelium Technologies, which operates Delta Exchange India.
The ED acted under Section 37 of the Foreign Exchange Management Act (FEMA). The 1999 statute sets rules for money entering and leaving India.
According to the agency, the case involves large-scale cross-border activity linked to crypto token derivatives and tokenized real-world asset products. The ED says it acted on intelligence indicating significant violations.
The ED describes the alleged process as follows: deposits in Indian rupees were converted into $USDT, a dollar-pegged stablecoin, and then allegedly sent offshore via one of two routes.
The first route reportedly passed through an entity based in Costa Rica that the ED describes as a “paper entity.” The second allegedly involved direct API connections to international platforms, including Binance, KuCoin, Gate.io and Bybit.
The alleged amounts are substantial. The ED estimates the unauthorized cross-border flows at several thousand crores of rupees.
Fees are another part of the case. A substantial share of Delta Exchange India’s futures and options trading was reportedly conducted offshore through CoinDCX. Transaction fees totaling hundreds of crores were reportedly settled in $USDT.
The exchanges push back
Neither company accepts the ED’s account. CoinDCX says it complies with Indian law, while Delta Exchange India denies making any cross-border transfers of virtual digital assets.
In statements issued on November 11 and 12, both exchanges said normal operations were continuing and user funds remained secure. Both companies say they are cooperating fully with the investigation.
The investigation has also expanded. The ED is now examining potential violations of three additional laws: the Securities Contracts (Regulation) Act 1956, the SEBI Act 1992 and the RBI Act 1934.
The expansion could be more significant than it first appears. The first two laws concern India’s securities framework, while the third governs the central bank. A case that began as a foreign-exchange matter now also touches on derivatives regulation and monetary oversight.
Why this case is worth watching
The allegations focus on one of crypto’s most challenging areas for regulators: derivatives. Futures and options let traders wager on price movements using leverage. When those bets are reportedly routed through offshore venues, domestic regulators lose sight of where the money and risk actually lie.
Stablecoins are central to the alleged process. According to the ED, $USDT acted as a bridge, turning rupees into an asset that could move across borders quickly.
The offshore platforms named in the case add another dimension. Binance, KuCoin, Gate.io and Bybit are major global venues. If the ED’s claims are substantiated, the case could raise sharper questions about how Indian platforms connect to international liquidity through technical integrations such as APIs.
The reference to tokenized real-world asset products is also notable. An enforcement case involving these products in India signals that authorities are monitoring newer offerings, not just conventional spot trading.
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