2024

Cyber

Coin

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 <p><strong>Key Highlights</strong></p>
 <ul>
  <li>A global ICIJ–Indian Express investigation found that crypto exchanges in India were used to route INR 623.63 crore stolen from nearly 2,900 victims.</li>
  <li>The Home Ministry’s I4C flagged 27 exchanges after analyzing 144 cybercrime cases, revealing how criminals converted stolen money into crypto and sent it abroad.</li>
  <li>India faces a regulatory vacuum as crypto use surges, with authorities struggling to police cross-border laundering and even store seized digital assets securely.</li>
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<p>A sweeping global investigation has revealed how cryptocurrency platforms are being used to move stolen money across borders, and India has found itself deeply entangled in the mess.&nbsp;</p>
<p>Over the past 21 months, the Home Ministry’s Indian Cyber Crime Coordination Centre (I4C) flagged 27 crypto exchanges that allegedly acted as channels for cybercriminals. According to officials, around INR 623.63 crore taken from nearly 2,872 victims ended up passing through these platforms between January 2024 and September 2025.</p>
<p>These findings are part of The Coin Laundry, a project led by <a href="https://indianexpress.com/article/express-exclusive/tax-havens-dirty-money-finds-new-home-cryptocurrency-10370103/" target="_blank" rel="noopener noreferrer nofollow">The Indian Express</a> along with the International Consortium of Investigative Journalists (ICIJ). For 10 months, 113 journalists from 38 newsrooms mapped out how digital assets have become a new route for illegal money to cross borders rapidly.</p>
<h2 class="wp-block-heading" id="how-crypto-is-being-misused">How crypto is being misused</h2>
<p>Investigators looked into 144 cybercrime cases involving Indian victims and found that criminals were converting stolen money into cryptocurrency almost immediately. Once the funds were converted, they were routed through multiple wallets, mixing services, and offshore exchanges, often disappearing in minutes.&nbsp;</p>
<p>As the investigation notes, “Cryptocurrency exchanges, operating in a regulatory grey zone and powered by technologies that race far ahead of policy, have become the newest gateways and hubs for dirty money to cross borders.”</p>
<p>Though blockchain records are public, the people behind the transactions remain hidden. This combination of speed and anonymity has turned digital tokens into a preferred tool for fraudsters, ransomware groups, drug syndicates, and networks looking to avoid sanctions.</p>
<h2 class="wp-block-heading" id="a-russian-link-that-stood-out">A Russian link that stood out</h2>
<p>One of the more unusual cases involved a Russian national accused of crypto crimes who had unexpectedly close ties to India’s entertainment and investor circles.&nbsp;</p>
<p>Investigators found that he had a role in a film featuring actors Kevin Spacey and Disha Patani, had organized investor events aimed at Indians, and even attended a birthday celebration in Mumbai for Maye Musk, the mother of entrepreneur Elon Musk. Behind this social façade, officials say, were connections to international laundering networks.</p>
<h2 class="wp-block-heading" id="india-s-regulatory-void">India’s regulatory void</h2>
<p>Even as cryptocurrency becomes more popular among Indian investors, official policy has not kept up. The government remains wary of regulating the sector because it fears regulation might look like approval. One official explanation in the report states that strictly regulating cryptocurrencies might “draw more investors into an asset seen as volatile and systemically risky.”</p>
<p>The Finance Ministry is currently putting together a discussion paper, but it is still at a very early stage. Meanwhile, enforcement agencies face practical problems. One top agency, unable to find a secure government system to store seized digital coins, has temporarily kept nearly $4 million worth of cryptocurrency with a private custody service.</p>
<p>For ordinary investors, the lack of clear rules means they are on their own if an exchange collapses or blocks withdrawals. There is no RBI help, no SEBI protection, and no dedicated grievance system.</p>
<h2 class="wp-block-heading" id="exchanges-under-pressure">Exchanges under pressure</h2>
<p>Indian exchanges say the environment has become difficult. Unclear rules combined with heavy taxes, including a 1% TDS on every transaction and a 30% tax on gains, have pushed traders away. Between April 2022 and July 2023, trading volumes on Indian platforms crashed by about 97%, with nearly INR 35,000 crore worth of activity moving to offshore exchanges that operate freely without following Indian requirements.</p>
<p>Most of the major Indian crypto platforms, including <a href="https://www.cryptotimes.io/tag/wazirx/" target="_blank" rel="noopener noreferrer nofollow">WazirX</a>, CoinDCX, Mudrex, CoinSwitch, Pi42, Onramp, and BitBNS, are owned through foreign entities. Founders say this is common in global fintech, though several admit that India’s uncertain policy environment played a big role in their decision.</p>
<h2 class="wp-block-heading" id="the-global-picture">The global picture</h2>
<p>Around the world, crypto exchanges have already paid more than $15.6 billion in fines and penalties over the past nine years. Enforcement is uneven—something highlighted in the report’s reference to “President Donald Trump’s recent pardon of Binance founder Changpeng Zhao after he pleaded guilty to money-laundering offenses.”</p>
<p>The Coin Laundry investigation shows how digital currencies have created a borderless financial space where illegal money moves faster than governments can react.</p>
<h2 class="wp-block-heading" id="what-happens-next">What happens next</h2>
<p>India now finds itself facing the same question many countries are struggling with: how do you regulate a system that moves faster than the law? The coming months, particularly the Finance Ministry’s next steps on the discussion paper, will decide whether India brings stronger rules to the crypto space or continues dealing with laundering cases long after the money has vanished into wallets abroad.</p>
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
 <p>Also Read: <a href="https://www.cryptotimes.io/2025/11/14/coinbase-files-with-cci-to-invest-in-indias-dcx-global/" target="_blank" rel="noopener noreferrer nofollow">Coinbase Files with CCI to Invest in India’s DCX Global</a></p>
</blockquote>

India’s Crypto Hubs Tied to INR 623-Crore Laundering Network

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