The co-founders of CoinDCX were granted bail by a Thane court after 72 hours of police interrogation.
• The court noted that the complainant had recovered his money from another accused and had filed an affidavit withdrawing his grievances against the founders.
• Police found no evidence linking the real executives to the fraud, which involved impersonators misusing the CoinDCX brand.
What began as a high-profile arrest of two of India’s most prominent crypto executives has quickly unraveled in court.
A Thane magistrate has granted bail to CoinDCX co-founders Sumit Gupta and Neeraj Khandelwal, ruling that there was no prima facie case linking them to an alleged fraud that initially led to their arrest.
Within days, the case shifted from a serious criminal probe to what now appears to be a case of impersonation and brand misuse.
On March 24, Judicial Magistrate Nilesh Rathod ordered the release of both founders on a personal recognisance bond of Rs 50,000 ($500) each.
The court also directed them to cooperate fully with the ongoing investigation.
The turning point came when the complainant, a 42-year-old insurance advisor from Mumbra, submitted an affidavit stating that he had recovered the full Rs 71.6 lakh ($83,000) from Gupta and Khandelwal and no longer had any grievance against them.
Police did not oppose bail. Case records also showed that neither founder was present in Mumbra at the time of the alleged transactions.
Taken together, these developments significantly weakened the case.
What initially appeared to be a direct fraud allegation against CoinDCX leadership quickly lost ground once evidence pointed elsewhere.
From Arrest to Release in Days
The case began with an FIR filed on March 16 at the Mumbra police station.
The complainant alleged he had been lured into a crypto investment and franchise scheme promising monthly returns of 10–12%.
According to the complaint, the accused used CoinDCX branding, documents, and the names of senior executives to build credibility.
The victim transferred Rs 71,60,015 through a mix of cash and online payments.
The FIR named six individuals, including Gupta and Khandelwal, under charges of cheating, criminal breach of trust, and fraud.
Police moved quickly. A team traveled to Bengaluru, where the founders are based, and arrested them on March 22.
They were produced before a magistrate the following day and remanded to police custody for around 72 hours of interrogation before being moved to judicial custody.
During questioning, investigators focused on whether the founders had any operational link to the alleged scheme.