ED Probes Mudrex, Instadapp Over ₹4,940 Cr Crypto Transfers

India's Enforcement Directorate (ED) has opened investigations into crypto platforms Mudrex and Saber.money, as well as DeFi protocol Instadapp and its platform Fluid, over alleged unauthorised cross-border fund transfers worth more than ₹4,940 crore.

The agency's Bengaluru Zonal Office searched three premises in Bengaluru and one in Madhya Pradesh on October 27 under Section 37 of the Foreign Exchange Management Act (FEMA), 1999. The probes focus on the alleged use of stablecoins such as USDT and USDC to move money outside authorised channels.

What the ED alleges

In the Mudrex and Saber.money case, the ED says its preliminary findings point to FEMA violations exceeding ₹4,600 crore. It named Bengaluru-based RPFAS Technologies Pvt Ltd as the operator of both platforms and said the company openly advertised instant cross-border transfers using cryptocurrencies without RBI authorisation. The platforms also allegedly offered on-ramp and off-ramp services, letting users convert INR, USD or EUR into digital assets and withdraw proceeds into bank accounts. In a post on X, the agency also cited shell entities in tax-haven jurisdictions, large over-the-counter transactions and foreign payouts through exchanges such as Binance and Bybit.

In the separate Instadapp and Fluid case, the ED alleges contraventions of about $40 million (around ₹380.6 crore). Instadapp is a DeFi protocol on Ethereum offering lending, borrowing and swapping through smart contracts. The agency says associated entities were incorporated abroad, in places including the US, Singapore, the British Virgin Islands and Dubai, but managed from India. Some allegedly had no physical offices or staff at their registered addresses, and funds from overseas investors were reportedly routed through foreign bank accounts and then sent to India to cover expenses.

Wider crackdown

This is the second such probe the ED has disclosed in recent months. In June it searched six premises linked to five Bengaluru-based platforms: Transak, Carret, Xpat, Onramp.money and Onmeta. It froze bank accounts holding around ₹6 crore in that case.

Cryptocurrencies remain unregulated in India, though gains face a 30% tax and every transaction attracts 1% TDS. Last month, a parliamentary standing committee on finance classed the asset class as "high risk", citing money laundering and suspicious transactions. The allegations are so far preliminary.