Thane Magistrate Court Grants Bail to CoinDCX Co-Founders in ₹71 Lakh Cheating Case, Citing Lack of Prima Facie Evidence

A significant legal development has seen the Thane Magistrate Court grant bail to Sumit Surendra Gupta and Niraj Ashok Khandelwal, the co-founders of the prominent Indian cryptocurrency exchange CoinDCX. The court’s decision, issued on March 23, came in response to a ₹71 lakh (approximately $75,000) cheating complaint that had led to their questioning and weekend remand. The magistrate ruled that no prima facie case was established against the CoinDCX executives, emphasizing that the allegations pertained to a fraudulent trading platform that had impersonated the legitimate Indian crypto exchange.

The common order on the bail applications concluded that both Gupta and Khandelwal were entitled to release, as an initial review of the available evidence did not substantiate any case against them. The founders had been taken in for questioning on a Saturday and subsequently remanded over the weekend, following a complaint by an investor who alleged they had been duped.

Delving into the specifics of the case, the magistrate’s order noted a crucial point: the investigation officer raised "no objection" to the release of the applicants. Furthermore, the court highlighted that the accused founders were not present in Mumbra, the location where the alleged offense took place. The magistrate explicitly recorded the informant’s admission in court that "some other person by representing as accused cheated the informant." This statement is pivotal, suggesting that the individual who engaged with the informant was not, in fact, one of the CoinDCX co-founders.

In response to the proceedings, CoinDCX issued a statement on X (formerly Twitter) on March 24, reinforcing the court’s findings. The exchange stated that the court proceedings supported a "third-party impersonation" scenario. CoinDCX firmly asserted that the fraud was perpetrated on a lookalike website, specifically identified as coindcx.pro, and that this fraudulent site had no affiliation or connection whatsoever with the official CoinDCX company. This distinction between the genuine platform and the imposter site is central to CoinDCX’s defense and the court’s reasoning for granting bail.

Further substantiating the claim of impersonation, the judge’s order detailed that the informant had filed an affidavit. In this affidavit, the informant stated that another individual, identified as Rana, had repaid the cheated amount. Crucially, the informant also declared that the CoinDCX founders were not the individuals he had met at a café in Kausa Mumbra, where the fraudulent deal was reportedly struck. This admission directly contradicts the premise of the complaint that Gupta and Khandelwal were the perpetrators.

With the matter appearing to be "amicably settled" between the informant and the alleged primary perpetrator (Rana), the court found no grounds to believe that the CoinDCX founders would interfere with evidence or attempt to contact witnesses. This resolution between the victim and the accused further weakened the case against the exchange’s leadership.

The court ordered the release of both Sumit Surendra Gupta and Niraj Ashok Khandelwal upon executing a bail bond of 50,000 Indian rupees each (approximately $530). This release is conditional upon their full cooperation with the ongoing investigation and any subsequent trial.

CoinDCX has framed this incident as part of a wider trend of increasing impersonation and phishing scams that are targeting well-known brands within India’s financial and cryptocurrency sectors. The exchange has taken this opportunity to reiterate its commitment to user security and has urged its customers to exercise extreme caution. Users are strongly advised to meticulously verify website domains and to exclusively interact with the official CoinDCX platform and its verified social media profiles to avoid falling victim to such fraudulent schemes.

Background and Prior Scrutiny:

CoinDCX, established in 2018 and headquartered in Mumbai, is one of India’s leading cryptocurrency exchanges. The company achieved a significant milestone, reaching an estimated valuation of around $2.45 billion following a substantial funding round in October 2025, which was notably led by Coinbase Ventures. This valuation underscores CoinDCX’s prominent position in the burgeoning Indian crypto market.

However, the platform has not been entirely free from security challenges. In July 2025, CoinDCX experienced a security incident where hackers managed to drain approximately $44 million from one of its internal operational accounts. At the time of the incident, CoinDCX was quick to emphasize that no customer funds were compromised, a critical distinction that likely mitigated broader user panic and regulatory scrutiny. Despite this, the incident served as a reminder of the inherent security risks in the digital asset space and the constant vigilance required by exchanges to protect their infrastructure.

The recent legal challenge, while resulting in a favorable outcome for the CoinDCX co-founders, highlights the persistent threats of online fraud and impersonation in the digital economy. The court’s decision to grant bail based on the lack of a prima facie case and the informant’s subsequent admissions points towards the complexity of proving identity and intent in cases involving sophisticated online scams. CoinDCX’s proactive communication and emphasis on user education underscore the ongoing efforts by reputable platforms to combat these evolving threats and maintain user trust.