Crypto Exchanges Linked to Rs 623 Crore Theft in India
A global investigation by the Indian Express and the International Consortium of Investigative Journalists (ICIJ) found that crypto exchanges in India helped launder Rs 623.63 crore stolen from nearly 2,900 victims. The Indian Cyber Crime Coordination Centre (I4C), part of the Home Ministry, flagged 27 crypto exchanges between January 2024 and September 2025. These platforms were used to convert and send stolen funds abroad.
How Criminals Exploit Crypto Platforms
Investigators examined 144 cybercrime cases involving Indian victims. They found criminals quickly converted stolen money into cryptocurrency. The funds moved through multiple wallets and offshore exchanges before disappearing. Digital currencies offer speed and anonymity, making them popular tools for fraudsters, ransomware gangs, drug cartels, and sanction evaders.
The report states, “Cryptocurrency exchanges, operating in a regulatory grey zone and powered by technologies that race far ahead of policy, have become the newest gateways for dirty money to cross borders.” While blockchain records are public, the identities behind transactions remain hidden.
Regulatory Challenges and Market Impact in India
India lacks clear regulations for cryptocurrencies. The government fears that strict rules might encourage more investors to join a volatile market. The Finance Ministry is preparing a discussion paper but is still at an early stage. Enforcement agencies face issues securing seized digital assets. One agency stores nearly $4 million in crypto with a private custodian temporarily.
Traders face unclear rules, heavy taxation, and no investor protection from authorities like RBI or SEBI. Taxes include a 1% TDS on transactions and 30% tax on gains. Consequently, Indian crypto trading volumes dropped about 97% between April 2022 and July 2023. Nearly Rs 35,000 crore shifted to offshore exchanges, which operate without Indian regulations.
Major Indian exchanges such as WazirX, CoinDCX, and BitBNS are owned by foreign entities. Founders cite unclear policies in India as a key reason for this structure.
