Delhi Court Urges CBI to Consider Probing ₹2,000 Crore WazirX Cryptocurrency Scam

Delhi Court Recommends CBI Probe in ₹2000 Crore Cryptocurrency Scam

A Delhi court has urged the Central Bureau of Investigation (CBI) to consider taking over a cryptocurrency fraud probe involving a massive ₹2,000 crore cyberattack on leading exchange platform WazirX, citing the complexity, magnitude, and potential global reach of the crime.

Background of the Case

On July 18, 2023, WazirX—operated by Zanmai Labs Pvt. Ltd.—suffered a sophisticated cyberattack that led to the unauthorized transfer of crypto assets worth 234 million USD (nearly ₹2,000 crore) from its third-party multi-signature wallets. These wallets held custody of user funds.

The company immediately approached the Delhi Police’s Intelligence Fusion and Strategic Operations (IFSO) unit, triggering a criminal investigation under charges of cheating and criminal conspiracy under the Bhartiya Nyaya Sanhita (BNS).

Key Developments

The court proceedings were initiated after the arrest of SK Masud Alam, a resident of Medinipur, West Bengal, who was caught during an extensive probe into the cyber heist. The accused was first arrested in August 2023, and his bail applications have been repeatedly denied over the past several months.

It was discovered that an account under the name Souvik Mondal, also from West Bengal, had received over ₹91 lakh in crypto assets shortly after being created on July 11, 2023—just a week before the breach. This account was later found to be operated using credentials linked to Alam.

Court’s Observation: Magnitude & Syndicate Involvement

While hearing Alam’s third bail application on May 1, 2025, Additional Sessions Judge Sumit Dass of Patiala House Court made several noteworthy observations:

“This particular case is one which requires it to be investigated by any national or central investigating agency like CBI. The magnitude of the offence, the manner in which it was committed, and the footprints all over the world require thorough investigation.”
— Judge Sumit Dass

The court also flagged the possibility of a global syndicate or even state-backed support, emphasizing that the stolen funds could potentially be used for broader illegal or terror-linked activities.

“There may be a participation of a syndicate or state support behind the fraud as it affects the industry and entrepreneurship. The amount so siphoned can be used for many more illegal activities.”
— Court Order Excerpt

Why the Court Involved the CBI

Judge Dass clarified that the court was not ordering a formal transfer of the case yet. Instead, it asked for the court’s recommendation to be sent to the Director of the CBI, who could evaluate and decide whether to formally initiate a CBI probe.

“Before deciding on the bail, the court would like to delve into why a cyber fraud with international ramifications should be investigated by a central agency,” the order said.

Additionally, the court emphasized the need to bust the entire module with the technical knowledge to hack multi-signature wallets, stating that such actors pose a significant threat to national cyber infrastructure.

The Investigation So Far

According to updates from the Investigating Officer (IO), notices have been sent to several organizations—both public and private—though details remain confidential due to their sensitive nature.

Alam’s Telegram-based recruitment into the fraud ring further highlights the use of encrypted apps for facilitating cybercrime. He allegedly connected with an individual named M. Hasan through Telegram, who promised him a financial reward for obtaining access credentials to WazirX.

Current Status & Next Hearing

• Alam has been in judicial custody for over eight months.
• His bail plea has been deferred repeatedly due to lack of clarity and progress in the probe.
• The next bail hearing is scheduled for May 19, 2025.

Key Takeaways

This case adds to a growing list of complex cyber and cryptocurrency-related crimes in India that may soon necessitate a stronger, centralized response. With the CBI potentially entering the picture, the outcome could reshape the investigative landscape for crypto scams in India.

What More Can Be Done?

While the court’s direction to consider a CBI probe signals seriousness, a larger issue remains: public awareness. Regulatory bodies like SEBI and RBI, alongside police cybercrime units, must continue building widespread awareness about cryptocurrency fraud. Moreover, clear guidelines for crypto transactions and platforms in India are the need of the hour.

This case also raises a critical question about inter-agency cooperation — especially in tech-driven crimes that span jurisdictions. If CBI takes over, it could set a precedent for centralizing high-value crypto scam investigations for better enforcement outcomes.

FAQs on the Delhi Crypto Fraud Case

Q1: Why is the case being considered for a CBI probe?
A Delhi court has directed city police to approach the CBI, citing the high value of the fraud and the interstate nature of the scam. The scale and complexity suggest that a central agency is better equipped to handle such cases.

Q2: What is the amount involved in the scam?
The accused allegedly defrauded investors of over ₹4.5 crore by luring them with high-return crypto investment promises.

Q3: How was the fraud executed?
Investors were persuaded to invest in cryptocurrencies through WhatsApp groups, fake trading platforms, and manipulated dashboards that showed rising profits. Once large sums were deposited, the culprits vanished.

Q4: Are such scams common in India?
Unfortunately, yes. The lack of regulation and the lure of high profits make crypto an attractive space for fraudsters. Reports of similar scams are increasing across multiple states.

Q5: What should investors do to avoid such scams?

• Avoid investing via unverified apps or links.
• Always verify the platform’s registration and credibility.
• Don’t fall for guaranteed returns — crypto is highly volatile.
• Report suspicious activity to the Cyber Cell or police immediately.