India’s Enforcement Directorate (ED) has raided cryptocurrency exchanges CoinDCX and Delta Exchange as part of an investigation into alleged illegal cross-border transactions involving USDT. The agency is examining transactions worth several thousand crore rupees and possible violations of the country’s foreign exchange regulations. The searches were conducted on November 4 and 5, 2026, across three premises linked to companies operating the two exchanges in Bengaluru.
According to the ED, CoinDCX allegedly converted customers’ rupee deposits into USDT and transferred the funds to overseas exchanges, including Binance, KuCoin, Gate.io, and Bybit, to facilitate spot and derivatives trading.
The agency also alleged that CoinDCX enabled tokenized stock trading through the decentralized exchange Hyperliquid. Delta Exchange was accused of routing a substantial volume of its derivatives and tokenized-stock trades through CoinDCX.
The investigation is focused on possible violations of India’s Foreign Exchange Management Act (FEMA), alongside other securities and financial regulations governing cross-border fund transfers. Both exchanges have responded to the investigation. CoinDCX maintained that it operates in compliance with Indian laws, while Delta Exchange denied facilitating cross-border transfers of virtual digital assets.
The ED's investigation remains ongoing, and the allegations have not been established as proven violations. The raids highlight India's growing scrutiny of cryptocurrency platforms and how they handle international transactions. The outcome of the investigation could have implications for exchange operations, stablecoin transfers, and regulatory compliance across the country's digital asset market.
