India ED Searches CoinDCX and Delta Exchange in FEMA Probe
The ED searched three Bengaluru premises linked to CoinDCX and Delta Exchange India on Nov. 4 and 5, alleging rupee deposits were converted to USDT and moved offshore. Both exchanges deny wrongdoing and say operations are normal.
Two Indian crypto exchanges are now inside a foreign exchange investigation. The Enforcement Directorate searched three premises in Bengaluru linked to CoinDCX and Delta Exchange India on Nov. 4 and 5, probing allegedly unauthorized cross-border crypto transactions under Section 37 of the Foreign Exchange Management Act (FEMA).
CoinDCX confirmed a Nov. 4 visit to its Bengaluru office. Delta acknowledged visits to its premises on Nov. 4 and 5.
The ED announced the searches on Nov. 6. It named Neblio Technologies, which operates CoinDCX, and Excelium Technologies, which operates Delta Exchange, and said the alleged transactions involved crypto derivatives and real-world asset tokens.
The agency alleges that rupee deposits were converted to USDT and moved offshore by one of two routes. One ran through a Costa Rica-based entity the ED describes as a "paper entity". The other used direct API links to Binance, KuCoin, Gate.io and Bybit. The ED puts the flows at several thousand crores of rupees. Much of Delta Exchange India's futures and options trading was reportedly executed offshore through CoinDCX, with fees of hundreds of crores settled in USDT.
One report says the probe now also covers potential violations of the Securities Contracts (Regulation) Act 1956, the SEBI Act 1992 and the RBI Act 1934. Not every account of the ED's announcement includes those statutes. FEMA itself is a civil statute, as the ED's own description of its mandate notes.
Both exchanges rejected any wrongdoing. CoinDCX called the visit a "routine enquiry", said it fully cooperated and complies with Indian law including FEMA, and said trading, deposits and withdrawals were "fully operational".
Delta said user funds remained secure in Indian banks and the platform was running without disruption. It described itself as an exchange settled in rupees for Indian users only.
"At Delta Exchange India, our business does not involve any cross-border transfer of VDAs in any form or manner"
Delta Exchange India
VDAs are virtual digital assets, India's statutory term for crypto.
A second wave
The November searches are a separate operation from the Oct. 27 action in Bengaluru and Madhya Pradesh, which targeted premises linked to Mudrex and Instadapp. In that round, the ED alleged more than ₹5,000 crore ($525M) in cross-border crypto transfers. The new action reaches two domestic exchanges and brings derivatives and tokenized real-world assets into scope.
Everything so far is allegation, and the exchanges dispute the ED's characterization. If the claims hold up, the case would raise questions about how Indian platforms connect to international liquidity and how rupee deposits are routed through stablecoins. For now, both platforms say service is unaffected.
