India Names Binance and Bybit Among Foreign Platforms in $585M Crypto Remittance Probe

India's Enforcement Directorate (ED) is investigating alleged cryptocurrency-linked cross-border transactions worth around $585 million (₹5,000 crore). The case involves local crypto platforms Mudrex and Saber.money, as well as decentralised finance protocol Instadapp. On October 27, the agency searched four premises, including three in Bengaluru and one in Madhya Pradesh, under the Foreign Exchange Management Act (FEMA).

The latest probe centres on RPFAS Technologies, which operates both Mudrex and Saber.money. The ED alleges that the company facilitated overseas transfers without authorization from the Reserve Bank of India. Customers reportedly deposited fiat currency that was converted into stablecoins such as USDT and sold through crypto exchanges to transfer funds outside official banking channels.

Foreign Exchanges Named

The investigation has identified overseas entities in the US, Canada and Lithuania, with ED naming Binance and Bybit among the foreign exchanges involved in the transactions under scrutiny. The agency estimates the alleged FEMA violations linked to RPFAS Technologies at $538 million (₹4,600 crore).

The operation follows an earlier ED investigation into CoinSwitch Kuber in August 2022, when the agency searched premises linked to the crypto exchange over suspected violations of India's foreign exchange laws.

Instadapp Investigation

The investigation also covers Instadapp, which operates under the name Fluid. The ED alleges that founder Sowmay Jain managed the protocol from India, despite the business being presented as US-based. According to the agency, stablecoin revenues passed through entities in the British Virgin Islands, Singapore and Dubai before being converted into fiat currency and transferred to India as payments for what it described as "bogus software development and consultancy fees".

The alleged FEMA violations involving Instadapp are estimated at $40 million (₹380 crore).

India's Crypto Crackdown

India has taken a tough stance on cryptocurrency operations, with authorities moving to block access to nine offshore platforms including Binance in December 2023. Binance and KuCoin later registered with India's Financial Intelligence Unit in 2024, with Binance subsequently fined ₹188.2 million for alleged anti-money laundering violations.

Separately, tax authorities raided six Indian crypto exchanges in January 2022, uncovering approximately $9.4 million in unpaid taxes. The allegations in the current case have not been established as findings of guilt, with investigations ongoing.