India’s Enforcement Directorate (ED) searched three premises in Bengaluru on 4 and 5 November 2026 linked to two Indian crypto exchanges, CoinDCX and Delta Exchange India. The agency alleges that CoinDCX turned its users’ rupee deposits into USDT and executed their trades on foreign platforms, Binance, KuCoin, Gate.io and Bybit among them, through an account held by a Costa Rica company it calls a paper entity. It puts the volumes at thousands of crores of rupees, according to its statement as reported by the Free Press Journal and Inc42 on 7 November.
What Indian media call the CoinDCX ED raid is a search under Section 37 of the Foreign Exchange Management Act (FEMA) of 1999, India’s law on money crossing the border. It is not a charge. No arrest, asset freeze or seizure has been announced, the investigation is ongoing and none of the allegations has been tested in court.
Binance’s name is in the headlines, not in the allegations. In the ED text relayed so far, Binance, KuCoin, Gate.io, Bybit and the decentralised platform Hyperliquid appear only as the venues where trades were allegedly executed; the agency accuses none of them of wrongdoing. All three premises searched are linked to the two Indian companies: Neblio Technologies, which runs CoinDCX, and Excelium Technologies, which runs Delta Exchange India.
India’s financial crime agency announced the searches on X on 6 November. Its post describes a case of “large scale unauthorized cross-border financial transactions involving crypto token derivatives and Real World Asset (RWA) tokens”. The tokenised stocks described below appear to be what it means by RWA tokens.
How the ED says CoinDCX mirrored orders abroad
Both platforms offered Indian customers spot crypto trading, crypto futures and options, and tokenised shares of foreign companies, the agency says; the Free Press Journal names Apple, Google and Tesla among those stocks. Neither exchange held the authorisation needed for these products, according to the ED, and Inc42 reports that it also accuses CoinDCX of advertising them.
Spot trades routed through a Costa Rica account
For spot trading, the agency’s account runs like this. A customer deposits rupees. The money is converted into USDT, the dollar stablecoin issued by Tether, and sent to overseas exchanges including Binance, KuCoin, Gate.io and Bybit, where the trades are carried out.
On paper, the account used for those transfers belonged to a company based in Costa Rica. Investigators suspect it has no real activity and say the orders were in fact sent directly by CoinDCX through its application programming interfaces (APIs). No report we found names the Costa Rica entity or its owners.
Futures and options opened 1:1 on foreign venues
Derivatives allegedly worked the same way. When a CoinDCX user opened a futures or options position, the exchange opened a matching position abroad in a 1:1 ratio through the same Costa Rica account, and settlement took place on the foreign platform once the user closed the trade. If the ED is right, the Indian order book was a front end for positions held elsewhere.
Tokenised stocks on Hyperliquid
For tokenised shares, CoinDCX allegedly used Hyperliquid, the blockchain, where users swap tokens directly from their own wallets without handing custody of their funds to a company.">decentralised exchange best known for its funding payment between longs and shorts, settled every few hours, keeps the contract price close to the spot or index price.">perpetual futures. Customer funds were again converted into USDT to open corresponding positions there, with settlement on Hyperliquid, according to the ED as reported by both the Free Press Journal and Inc42. Like the centralised venues, Hyperliquid is named as a destination, not accused. Readers new to these products can see what a tokenized stock really gives you, and our step-by-step guide to Hyperliquid explains how its markets work.
Two further findings concern CoinDCX alone. Investigators say the exchange kept enterprise trading accounts on foreign exchanges, holding crypto assets there in breach of FEMA. They also allege that CoinDCX paid hundreds of crores of rupees in transaction fees to foreign platforms in USDT, bypassing the FEMA framework for payments abroad.
Delta Exchange allegedly routed its derivatives through CoinDCX
Delta Exchange India faces related but separate claims. It offered the same kinds of products, according to the agency, and a large share of its futures, options and tokenised-stock trades was passed to CoinDCX, which executed them on foreign exchanges. The Free Press Journal lists Binance, KuCoin, Gate.io and Bybit as those venues and puts the volume at several thousand crores of rupees; Inc42 speaks only of foreign platforms.
Delta also sent hundreds of crores of rupees to associate companies based overseas, investigators say. What those transfers paid for is still being examined.
Beyond FEMA, the agency says the products of both firms appear, prima facie, to breach the Securities Contracts (Regulation) Act of 1956, the SEBI Act of 1992 and the Reserve Bank of India Act of 1934, points it is examining separately. Those laws belong to the securities regulator SEBI and to the central bank, and neither has announced action of its own. This ED action does not cite India’s anti-money laundering law (PMLA).
CoinDCX ED raid: what the figures add up to, and what they leave out
No total has been published. Every amount comes as an order of magnitude. A crore is 10 million rupees, so 1,000 crore is 10 billion rupees, or roughly $105 million at the rate of about 95 rupees to the dollar that Bitcoin.com News used on 7 November. Nothing in the statement is precise enough to turn the whole case into a dollar figure.
| Alleged flow (ED, as reported 7 November) | Platform | Where it ended up | Size given by the ED |
|---|---|---|---|
| Spot crypto trades, rupees converted to USDT | CoinDCX | Binance, KuCoin, Gate.io, Bybit, via a Costa Rica account | Thousands of crores of rupees |
| Futures and options mirrored 1:1 | CoinDCX | Foreign exchanges, same Costa Rica account | Thousands of crores of rupees |
| Tokenised foreign stocks | CoinDCX | Hyperliquid | Thousands of crores of rupees |
| Fees paid to foreign platforms in USDT | CoinDCX | Foreign exchanges | Hundreds of crores of rupees |
| Derivatives and tokenised stocks passed to CoinDCX | Delta Exchange India | Binance, KuCoin, Gate.io, Bybit (FPJ) | Several thousand crores of rupees (FPJ) |
| Transfers to overseas associate companies | Delta Exchange India | Associate entities abroad | Hundreds of crores of rupees |
Several facts are still missing. The agency has not said who owns the Costa Rica company, how many users were involved, over what period the trades ran or whether a court is involved. The detailed allegations below rest on the ED’s statement as relayed by Indian outlets that quote it at length; no press release on the ED’s own website was available on 7 November.
Delta Exchange answers, CoinDCX stays silent
Delta Exchange India replied on X on 6 November, the day of the ED post. It said it “cooperated fully with the officials and provided the information that they sought” and is not involved in “any cross-border transfer of VDAs in any form or manner”, VDA being India’s legal term for crypto assets. Trading, deposits and withdrawals were working normally and user funds remained in Indian banks, the exchange added, according to Bitcoin.com News, which reproduced the statement.
CoinDCX had not issued a statement when Inc42 and Bitcoin.com News published, and none had appeared by 13:00 UTC on 7 November. Binance, KuCoin, Gate.io, Bybit and Hyperliquid had not commented either.
For CoinDCX, which TechCrunch described in July 2025 as registered with India’s Financial Intelligence Unit and serving more than 16 million users, it is a second blow in a month. On 22 October it confirmed a $16 million USDT loss from retired wallets, three days after denying a hack. In July 2025 an internal account used for liquidity on a partner exchange was drained of about $44 million, with customer funds unaffected, as TechCrunch reported on 21 July 2025.
ED Bengaluru’s third reported crypto search since June
Working under the same law, the Bengaluru office has been taking India’s crypto firms one case at a time. In late October it searched premises tied to Mudrex, Saber.money and the DeFi protocol Instadapp with its platform Fluid, over alleged unauthorised transfers abroad worth more than 4,940 crore rupees, about $525 million, according to Inc42 and Bitcoin.com News.
In June 2026 it searched six premises linked to Transak, Carret, Xpat, Onramp.money and Onmeta, again over unauthorised cross-border crypto transfers, as both outlets recall.
Each time, the agency treats stablecoins leaving India as foreign exchange moving without the approvals FEMA requires. The CoinDCX file adds a second layer: the products themselves, derivatives and tokenised stocks above all, may fall under securities and banking rules that crypto exchanges are not licensed for.
Binance in India: a venue here, a fined exchange in 2024
Binance does have its own history with Indian authorities. FIU-IND fined it 18.82 crore rupees on 19 June 2024 for failing to meet its duties as a reporting entity under the anti-money laundering law, after a notice sent in December 2023, as Medianama reported. Binance was allowed back into the Indian market after paying the fine.
That episode concerned Binance’s own registration. The new case is about what two Indian exchanges allegedly did with their customers’ money, and the ED text names Binance only as one of the places where those orders were executed. Binance’s October 2026 hack is a separate matter with no link to the searches.
What it means for Indian users and for the tax bill
Nothing has changed on the platforms so far. Delta Exchange India says it operates as usual, and no freeze on CoinDCX accounts has been reported. Bitcoin.com News sees the next questions as whether the ED freezes assets or summons executives, and whether SEBI opens its own case over the derivatives and tokenised-stock products.
This case is about authorisation and foreign exchange rules, not taxes. India’s crypto tax regime still applies in full: a flat 30% tax on gains from virtual digital assets and a 1% tax deducted at source on transfers, rates in place since 2022 and carried into the new Income-tax Act 2025, according to tax guides. Trades mirrored on a foreign venue are not exempt, and nothing in the ED statement suggests the case involves tax.
For readers outside India, the question is familiar. In the European Union, an exchange serving local clients needs authorisation under MiCA, as our guide to the MiCA regulation explains, and a front end that sent every order to a venue abroad would face the same question of who really holds the client’s position.
No date has been given for the agency’s next step, and CoinDCX had still not answered the allegations at 13:00 UTC on 7 November.