Indian authorities investigate cryptocurrency platforms for alleged FEMA violations
India’s Enforcement Directorate has launched probes into RPFAS Technologies and Instadapp, alleging unauthorized cross-border cryptocurrency transactions.
The Indian Enforcement Directorate (ED) has conducted searches at four locations as part of an investigation into suspected violations of the Foreign Exchange Management Act (FEMA). The inquiry focuses on RPFAS Technologies, which operates the Mudrex and Saber.money platforms, and the decentralized finance protocol Instadapp, now operating largely as Fluid.
According to the ED, the transactions under scrutiny total approximately 5,000 crore rupees. Officials allege that the entities bypassed established regulatory frameworks by employing shell companies in tax havens and utilizing foreign crypto exchanges to facilitate unauthorized money transfers. The agency specifically claims that RPFAS Technologies advertised instant cross-border transfers using stablecoins despite lacking authorization from the Reserve Bank of India.
Regarding Instadapp, the ED alleges that the firm operates primarily from India, despite its registration in the United States. Investigators claim that revenue was routed to India through artificial consulting and software development fees to mask the origin of funds. No charges or arrests have been announced, and the investigation remains ongoing.