CoinDCX founders Sumit Gupta and Neeraj Khandelwal are under scrutiny in a crypto fraud case tied to losses of about $75,000. Public reports on the authorities’ actions remain mixed: some said the pair were arrested on allegations of criminal breach of trust, while others said they were questioned rather than taken into custody.
The case stems from a complaint filed by a 42-year-old insurance consultant, who said he lost around 7.1 million rupees after investing through a fake website that posed as CoinDCX. That complaint triggered the investigation and brought the exchange’s founders into the matter.
Exchange denies involvement and points to brand abuse
CoinDCX rejected the accusations and said the complaint reflects a broader fraud pattern in which bad actors impersonate the exchange. The company said it had no connection to the fake website involved in the complaint and stated that the diverted funds were taken by outside parties, not through the exchange itself.
CoinDCX also said it is cooperating fully with law enforcement. The company described brand impersonation and cyber fraud as a growing problem in India’s digital finance sector, especially for crypto users exposed to phishing-style scams.
More than 1,200 websites reportedly impersonated CoinDCX
According to the exchange, more than 1,200 websites impersonated its domain or brand between April 2024 and January 2026. The figure suggests the issue extends well beyond a single fake page. For users, common actions such as logging in, depositing funds, or withdrawing assets can become attack points when they are redirected to spoofed websites.
The case also lines up with a wider rise in investment fraud in India. Data cited from the Ministry of Home Affairs said investment scams accounted for 76% of all financial losses in 2025. Across the broader Web3 sector, losses from hacks and exploits reached nearly $4 billion globally in 2025.
Large exchange, unresolved questions over enforcement action
Founded in 2018, CoinDCX is one of India’s major crypto exchanges. The report said the company reached a $2.45 billion valuation after an investment from Coinbase Ventures in 2025. Questions remain over whether the founders were only questioned or were briefly arrested, but CoinDCX’s position is clear: it says the incident was driven by fraudulent websites misusing its brand.