TL;DR
- CoinDCX CEO Sumit Gupta has publicly denied allegations that the exchange transferred user funds to non-compliant entities in Lithuania.
- The allegations were made by WazirX, currently under investigation after a $230 million hack.
- Gupta confirmed that Neblio Technologies, a registered and compliant Indian entity, holds all user funds.
- The CEO stated that CoinDCX never operated in Lithuania and updated its Terms of Use in February 2025 to reinforce transparency.
CoinDCX Refutes Claims of Non-Compliant Fund Transfers
In a direct response to growing industry scrutiny, CoinDCX co-founder and CEO Sumit Gupta has dismissed accusations that the exchange transferred user funds to non-compliant entities in Lithuania. The claims were allegedly made by rival Indian exchange WazirX, currently facing legal and public pressure following a $230 million security breach in 2024.
Gupta labeled the claims “misinformation”, reaffirming that all CoinDCX user assets remain securely held under Neblio Technologies, a registered entity with India’s Financial Intelligence Unit (FIU-IND).
“Please don’t be fooled by misinformation,” Gupta said in a message to CoinDesk.
Background: WazirX Allegations Surface Amid Ongoing Probe
The allegations against CoinDCX emerged through a filing submitted as part of proceedings in the Singapore High Court, where WazirX is scheduled to appear on July 15, 2025.
According to WazirX’s affidavit, CoinDCX allegedly held Indian user funds with a Lithuania-based entity that was not registered with FIU-IND until February 2025.
This filing comes as WazirX continues to navigate a wave of regulatory and user backlash after one of the largest crypto exchange hacks in Indian history, in which $230 million in user assets were compromised.
CoinDCX: “No Business Conducted in Lithuania”
In a formal rebuttal, Gupta clarified that CoinDCX had no operational presence or registered entity in Lithuania before February 2025, and that any external engagement with the region was exploratory only, for potential global expansion—not operational business or fund custody.
“CoinDCX (Neblio Technologies) never conducted any business activities in Lithuania, and user funds were never transferred to or held by any Lithuania-based entity,” Gupta stated.
He emphasized that Indian rupee and crypto balances of all domestic users are securely custodied by Neblio Technologies, which has been FIU-IND compliant from inception.
Indian Exchange Landscape
| Exchange | Major Controversy | FIU-IND Registered | Current Legal Status |
| WazirX | $230M hack in 2024 | Registered post-incident | Under court investigation |
| CoinDCX | Accused of offshore custody | Registered (Neblio Technologies) | Denies allegations, under scrutiny |
| ZebPay | Internal KYC lapses | Registered | Cooperating with FIU |
| CoinSwitch | FIU registration delayed | Registered | Resolved with regulator |
Strengthening User Trust: Proactive Terms Update
To further solidify its position, Gupta revealed that on February 7, 2025, CoinDCX updated its Terms of Use to officially designate Neblio Technologies as the legal contracting entity for all users. The move, according to Gupta, was driven by a proactive desire to increase transparency and legal clarity, not by regulatory enforcement.
“We did this proactively so that CoinDCX users never face challenges like those seen during the WazirX incident,” Gupta explained. “This protects user interests and ensures business continuity in uncertain conditions.”
Gupta also expressed hope that other Indian crypto exchanges would adopt similar clarity-first models to prevent misunderstandings and regulatory loopholes.
Industry Tensions: WazirX and CoinDCX Square Off
The allegations and counter-statements between WazirX and CoinDCX come at a critical moment for India’s crypto ecosystem, which has witnessed intensified government scrutiny, mounting pressure from the FIU, and elevated public expectations on compliance and fund security.
While both exchanges were previously seen as key players in India’s crypto rise, their rivalry—now playing out in legal filings and public statements—reflects a broader realignment in how crypto businesses position themselves in light of regulatory maturity.
CoinDCX’s clear stance on onshore custody and WazirX’s struggle with fallout from the hack underline the divergent paths Indian crypto firms may now take in the face of tightening oversight.
Public and Legal Implications
Legal experts suggest that if CoinDCX successfully establishes that all funds remained within Indian jurisdiction and under a compliant custodian, it may emerge as a model for crypto compliance in India.
“Custody, compliance, and contractual clarity are now the gold standards for surviving Indian crypto regulation,” said one blockchain legal advisor familiar with the matter.
On the other hand, if WazirX’s claims are validated, CoinDCX may face regulatory audits or potential penalties, though no such action has yet been announced by Indian authorities.
CoinDCX’s Forward-Looking Position
Gupta concluded his statement with a reaffirmation of the platform’s guiding principles:
“CoinDCX remains committed, as always, to user security, transparency, and regulatory compliance.”
The company continues to participate in dialogues with Indian regulators and is working toward expansion plans that include global compliance standards, according to company insiders.
