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India’s Enforcement Directorate just kicked down the door on five Bengaluru-based crypto firms suspected of moving more than Rs 2,500 crore, roughly $300 million, across borders without the blessing of India’s central bank.
The raids, conducted on June 17 across six locations, targeted companies operating crypto payment and remittance platforms. The ED alleges these firms converted Indian rupees into virtual digital assets, primarily stablecoins like USDT, and used a mix of over-the-counter trading, shell entities, and foreign platforms to shuttle money out of the country.
Who got raided and what did the ED find
The five companies under the microscope are Transak Technology India Private Limited, Carretx Technologies Private Limited, Mokshagna Technologies Private Limited, Buyhatke Internet Pvt. Ltd., and Abhibha Technologies Private Limited.
Each allegedly operated without the authorizations required by the Reserve Bank of India for cross-border money movement. The ED froze approximately Rs 6 crore in bank assets connected to these firms during the operation.
Two of the companies drew particular attention for the complexity of their alleged schemes. Transak is accused of routing profits through a US-based affiliate, effectively siphoning earnings offshore. Mokshagna, meanwhile, allegedly managed funds belonging to US customers through Indian channels, creating a reverse flow that further tangled the jurisdictional web.
The investigation is being pursued under the Foreign Exchange Management Act, commonly known as FEMA. This isn’t a money laundering case under India’s Prevention of Money Laundering Act. It’s a foreign exchange compliance action, which suggests the ED views these operations primarily as unauthorized remittance businesses rather than criminal enterprises laundering illicit proceeds.
India’s tightening grip on crypto compliance
The FEMA framework requires anyone facilitating cross-border transfers to obtain proper authorization from the RBI. These raids are distinct from previous ED investigations that targeted older Bitcoin-era scams or cases brought under money laundering statutes, reflecting the government’s growing awareness that stablecoins have become a tool for moving value across borders outside the regulated financial system.
What this means for investors and the Indian crypto market
For crypto firms operating remittance or cross-border payment services in India, this is a direct warning. The ED has demonstrated it will pursue FEMA violations aggressively, and the frozen assets, while modest at Rs 6 crore, represent just the opening move.
Companies like Transak, which operates as a fiat-to-crypto onramp and has a visible international presence, now face reputational risk on top of legal exposure. Being named in an ED investigation creates immediate friction with banking partners, payment processors, and institutional clients who have their own compliance obligations.
For retail investors in India, no major tokens saw price movement tied to this action. The country’s 1% TDS on crypto transactions and 30% flat tax on gains already made it one of the more punitive regulatory environments.
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