The Delhi High Court has asked the Centre, RBI and SEBI to submit responses after a petition flagged serious concerns about the financial crisis at crypto exchange BitBNS
BitNS came under scrutiny after users reported of frozen withdrawals, prompting a plea for stringent cryptocurrency regulation and a probe into the exchange’s operations
At least 16 users filed the petition alleging that the platform was engaged in mismanagement and concealing a cyberattack that took place in February 2022.
The Delhi High Court has reportedly sought responses from the Centre, the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI) pertaining to a petition flagging serious concerns about a financial crisis allegedly impacting users of BitBNS cryptocurrency exchange.
BitNS has recently faced scrutiny after users reported of frozen withdrawals, prompting a plea for stringent cryptocurrency regulation and a probe into the exchange’s operations.
At least 16 users filed the petition alleging that the platform was engaged in mismanagement and concealing a cyberattack that took place in February 2022.
This breach reportedly led to the illicit transfer of user funds abroad, intensifying the call for accountable governance within the cryptocurrency sphere.
The users have also called for a thorough investigation by a Special Investigation Team (SIT) or the Central Bureau of Investigation (CBI).
Justice Sachin Datta, overseeing the case regarding the BitBNS cryptocurrency exchange, indicated that agencies such as the Enforcement Directorate (ED) and the CBI possess the necessary expertise to handle these issues effectively.
The petition highlights several critical problems faced by BitBNS users withdrawal delays and portfolio discrepancies.
Despite numerous complaints lodged with authorities, including one with National Cyber Crime Portal, petitioners argue that their attempts to seek resolution have been hindered by jurisdictional and infrastructural challenges.
In light of the alleged discrepancies faced by users of BitBNS, other developments surrounding WazirX and CoinSwitch also reflect ongoing challenges in the Indian cryptocurrency landscape.
WazirX experienced a significant cyberattack in July 2024, resulting in the theft of approximately $230 Mn worth of cryptocurrencies. This incident led to the suspension of trading and withdrawals on the platform.
WazirX aims to fully resume crypto withdrawals by mid-April 2025, more than nine months after the attack. CoinSwitch has also launched a INR 600 Cr recovery program aimed at assisting WazirX users affected by the cyberattack.