Key Takeaways
- CoinDCX founder Sumit Gupta spoke out about his arrest in a cyber fraud case.
- Gupta pledged $12 million to strengthen India’s cyber fraud infrastructure.
- The complainant withdrew the allegations, and the court granted the founders bail.
CoinDCX co-founder and CEO Sumit Gupta has broken his silence following his recent arrest in a high-profile cyber fraud case.
He called the experience a wake-up call for India’s digital security ecosystem.
Speaking in a virtual press briefing, Gupta described the ordeal as both personal and revealing, highlighting how easily fraudsters can exploit trust in the fast-growing crypto sector.
CoinDCX Founder Pledges $12 Million After Arrest Ordeal
In response, Gupta announced a $12 million initiative aimed at strengthening India’s cybercrime defenses.
The program will focus on law enforcement training, improved verification systems, and public awareness campaigns, particularly in Tier-2 and Tier-3 cities.
The move comes just days after Gupta and co-founder Neeraj Khandelwal were granted bail.
CoinDCX has maintained from the outset that the case stemmed from impersonators misusing the company’s brand, not any internal wrongdoing.
Reflecting on the experience, Gupta said the episode exposed deeper gaps in how fraud cases involving digital platforms are handled.
“I never imagined that building one of India’s leading crypto platforms would lead to me being arrested over a scam I had no part in,” Gupta said. “The process was eye-opening. From the moment the police showed up in Bengaluru to the hours spent in custody, it became clear how easily impersonators can drag innocent parties into legal nightmares while the real culprits operate in the shadows.”
Industry observers see the $12 million pledge as a proactive step, especially as India’s crypto user base continues to expand rapidly.
With millions of new users entering the space, stakeholders increasingly see stronger infrastructure and awareness as essential to maintaining trust.
What Led to the Arrest?
The case originated from a complaint filed on March 16 at the Mumbra police station in Thane.
A 42-year-old insurance advisor, Ashish Brijkishor Singh, alleged that CoinDXC defrauded him of Rs 71.6 lakh (around $85,000) between August 2025 and February 2026.
According to the complaint, fraudsters used a fake website mimicking CoinDCX and posed as company representatives, promising high returns and franchise opportunities.
Singh claimed he transferred funds after interacting with individuals impersonating the founders.
Police registered an FIR against six individuals, including Gupta and Khandelwal, under charges related to cheating, criminal breach of trust, and fraud.
On March 22, Thane police arrested the founders in Bengaluru and brought them before a magistrate, leading to roughly 72 hours in custody.
Case Unravels as Key Evidence Emerges
The case took a dramatic turn within days.
On March 24, the complainant submitted an affidavit stating he had recovered the full amount from Akash Rana and no longer held any grievance against the CoinDCX founders.
Investigators also found no evidence linking Gupta or Khandelwal to the fraudulent activity.
Fraudsters carried out the scam entirely through a cloned platform, without involving the official exchange.
The court ruled there was no prima facie case against the founders and granted bail on a personal recognizance bond of Rs 50,000 each.
They were released with instructions to cooperate in the ongoing investigation targeting the remaining accused.
CoinDCX reiterated that user funds on its platform remained secure throughout the incident, with no disruption to trading or withdrawals.
A Larger Problem for India’s Crypto Ecosystem
The case has reignited concerns about the rise of impersonation scams in India’s digital finance space.
Fraudsters increasingly use cloned websites, fake identities, and social engineering tactics to exploit the credibility of established platforms.
As adoption grows, so does the risk for new users who may not be familiar with these tactics.
Gupta’s pledge aligns with broader calls for stronger collaboration between exchanges, regulators, and law enforcement.
Experts point to measures such as real-time alerts, improved monitoring, and education as critical steps to reduce fraud.
For now, the episode serves as a reminder that as crypto adoption expands, so does the need for stronger safeguards.
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Prashant Jha is a seasoned crypto journalist based in Delhi, India, with a Bachelor’s Degree in Computer Science Engineering. Passionate about the evolving world of blockchain and cryptocurrencies, he has been a dedicated voice in the industry since 2018. Prashant’s expertise lies in regulatory reporting, where he unravels complex legal and financial developments with clarity and precision. Before joining CCN in 2024, he honed his craft at Cointelegraph, establishing himself as a trusted name in crypto journalism.
His coverage spans major industry events, including the high-profile collapses of FTX, Three Arrows Capital (3AC), and LUNA, offering readers insightful analyses of their regulatory and market implications. Prashant’s technical background enables him to bridge the gap between intricate blockchain technology and its real-world applications, making his work accessible to novices and experts.
Beyond his professional pursuits, Prashant is an avid music enthusiast, often exploring diverse genres to unwind. A sports lover, he has a particular passion for cricket and frequently engages in discussions about the game. His multifaceted interests and sharp journalistic instincts make him a valuable contributor to CCN, where he continues shaping the crypto landscape's narrative.
