CoinDCX Rebukes Fraud Allegations, Points to Impersonation Scam in Police Probe

Indian cryptocurrency exchange CoinDCX on Sunday dismissed fraud charges linked to a police investigation, saying the case stems from impersonators posing as its founders and misusing the brand to defraud investors.

The answer follows A report Through Entrackr that the exchange’s founders, Sumit Gupta and Neeraj Khandelwal, were questioned as part of an investigation into a crypto investment scam involving individuals posing as representatives of CoinDCX.

“The FIR filed against our co-founders is false and is being filed as a conspiracy against CoinDCX by impersonators posing as founders of CoinDCX and defrauding the general public,” the company said in a post on Xadding that it has issued a public warning: “CoinDCX is being targeted by fraudsters.”

“The entire conspiracy falsely claims that cash funds were transferred to third-party accounts unrelated to CoinDCX,” the platform said.

Declutter has contacted CoinDCX for further clarification; the company did not respond reports of the founders’ arrest.

A Mumbra-based insurance consultant was allegedly lured into a scheme that promised 10-12% returns using CoinDCX’s brand name and documents, according to the report, with an FIR registered in Thane naming the company’s founders, among others.

He reported losses of $76,000 (Rs 71.6 lakh) between August 2025 and March, including $28,000 (Rs 26.6 lakh) that he invested, while two associates invested $26,000 (Rs 25 lakh) and $21,000 (Rs 20 lakh).

“This appears to be a classic case of impersonation fraud,” said CA Sonu Jain, Chief Risk and Compliance Officer at 9Point Capital. Declutterposting a pattern that is “becoming increasingly common in the Indian crypto space.”

“Indian VASPs have repeatedly warned users and reported such fraudulent websites to the police,” Jain said, noting that bad actors often exploit trusted brands to build credibility.

“Founders summoned for questioning in such cases should not be mistaken for guilt,” he added, describing it as “a procedural step once an FIR is registered.”

An FIR, or First Information Report, is a formal report of a complaint made by the police when they receive information that a cognizable crime has been committed.

Lack of ‘clear legal standards’

“The bigger problem is the lack of clear regulatory standards and frameworks for investor protection in India,” Jain said, warning that gaps in oversight allow “such incidents to continue.”

“Regulators should now focus on clearly defining platform responsibilities, which will enable faster takedown of fraudulent domains and formalize coordination between FIU-India, I4C, CERT-In and crypto exchanges to proactively curb such scams,” Jain added.

CoinDCX said the complainant has no ties to its platform and rejected claims that funds were routed through its systems.

The exchange mapped the extent of impersonation, reporting more than 1,212 fake websites impersonating the site between April 1, 2024 and January 5, 2026.

CoinDCX said it is working with law enforcement and continuing its efforts to raise user awareness to prevent such incidents.

“Whatever the outcome here, it would be worth reflecting on whether enough is being done around financial literacy and due diligence across the board, by users, builders and regulators,” Vedang Vatsa, founder of global crypto community Hashtag Web3, told me. Declutter.

The development comes after a volatile year for the stock market.

Last July, CoinDCX revealed a $44.2 million treasury breach, with a Bengaluru-based software engineer at the company arrested for allegedly enabling the hack where attackers siphoned off an internal CoinDCX account using compromised credentials.