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India’s Enforcement Directorate has searched premises tied to two of the country’s crypto exchanges, CoinDCX and Delta Exchange India. The agency is probing alleged unauthorized cross-border transactions and a breach of foreign exchange law.
What the ED says it found
The searches took place on November 4 and 5, 2026, across three locations in Bengaluru. They targeted Neblio Technologies, the company behind CoinDCX, and Excelium Technologies, which runs Delta Exchange India.
The ED acted under Section 37 of the Foreign Exchange Management Act, or FEMA. That 1999 statute sets the rules for how money enters and leaves India.
According to the agency, the case centers on large-scale cross-border activity tied to crypto token derivatives and tokenized real-world asset products. The ED says it moved on the basis of intelligence pointing to significant violations.
The mechanics, as the ED describes them, go like this. Indian rupee deposits were allegedly converted into USDT, the dollar-pegged stablecoin. That USDT was then allegedly sent offshore by one of two routes.
The first route reportedly ran through a Costa Rica-based entity the ED characterizes as a “paper entity.” The second allegedly used direct API connections to international platforms, including Binance, KuCoin, Gate.io and Bybit.
The alleged volumes are not small. The ED puts the unauthorized cross-border flows at several thousand crores of rupees.
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There is also a fee angle. A substantial part of Delta Exchange India’s futures and options trading was reportedly executed offshore through CoinDCX. Transaction fees running into hundreds of crores were reportedly settled in USDT.
The exchanges push back
Neither company is conceding the ED’s version of events. CoinDCX has said it complies with Indian law. Delta Exchange India has gone further, denying that it made any cross-border transfers of virtual digital assets at all.
As of November 11 and 12, both exchanges put out statements saying normal operations were continuing. They also said user funds remained secure. Both firms say they are cooperating fully with the inquiry.
The probe is also widening. The ED’s investigation now covers potential violations of three more laws: the Securities Contracts (Regulation) Act 1956, the SEBI Act 1992 and the RBI Act 1934.
That expansion matters more than it might look at first glance. The first two touch India’s securities framework, and the third governs the central bank. A case that began as a forex matter now brushes against derivatives regulation and monetary oversight too.
Why this case is worth watching
The allegations zero in on one of the trickiest parts of crypto for any regulator: derivatives. Futures and options let traders bet on price moves with leverage. When those bets are reportedly routed through offshore venues, a domestic watchdog loses sight of where the money and the risk actually sit.
Stablecoins are the connective tissue here. In the ED’s telling, USDT served as the bridge that turned rupees into something that could move across borders quickly.
The named offshore platforms add another layer. Binance, KuCoin, Gate.io and Bybit are major global venues. If the ED’s claims hold up, the case could sharpen questions about how Indian platforms interact with international liquidity through technical integrations like APIs.
The inclusion of tokenized real-world asset products is also notable. An enforcement case touching it in India signals that authorities are watching these newer products, not just plain spot trading.
