- India’s ED arrested an Indian national allegedly connected to a crypto hawala network.
- The accused converted narcotics-related money into crypto and foreign currencies.
- The move comes as part of India’s larger efforts to track the illicit use of crypto.
India’s Enforcement Directorate (ED) has uncovered an alleged crypto hawala network linked to international drug trafficking. The agency reportedly arrested a Dubai-based Indian national for using digital assets to launder money from drug trafficking.
The accused, Nihal V.N., has allegedly converted cash created through narcotics sales in India into crypto and foreign currencies, stated the ED. Later, he moved the funds overseas via a cross-border crypto-hawala network.
According to an official press release by the Indian authority, the funds were sent to drug suppliers in Brazil and Thailand. The money was allegedly used to purchase high-grade narcotics and synthetic drugs, which were later smuggled to India. Reportedly, the ED identified several crypto wallets, bank accounts, and shell companies suspected to be a part of the hawala operation.
Inside India’s Crypto Drug Hawala Probe
It is worth noting that the crypto hawala network case began when the Anti-Narcotics Cell of the Goa Police filed an FIR under the NDPS Act. The case unfolded an alleged interstate drug trafficking network. As part of the investigation, India’s ED launched a money laundering probe, with the team arresting the main accused Madhupan S.S. in January 2026.
Interestingly, social media platforms are now abuzz with these discussions. Many Indian and foreign crypto enthusiasts have raised concerns about the growing use of digital assets in drug trafficking networks. For instance, Crypto Aman, a prominent figure, shared details on the latest development within ED’s investigation.
As the investigation moved forward, the Indian authorities seized narcotics worth around ₹1.1 crore in Goa. This included 1,825 LSD blots, cocaine, charas and DMT. While the agency searched 26 locations across several states, it recovered about ₹3 crore in cash, digital devices and documents. The agency added that the team distributed drugs across multiple Indian states via a business-to-business (B2B) supply model. They used crypto, offshore accounts, and shell companies to move these illicit funds.
Related: India Proposes First Property Tokenization Law With DELTA Act
India Expands Crypto Crackdown on Drug and Cyber Crimes
Significantly, the latest development within this crypto hawala network case is a part of India’s larger efforts to combat growing crypto-related financial crimes. Earlier this year, ED Director Rahul Navin stated that the agency is putting efforts into tackling crypto fraud, terror financing, cybercrime and narcotics trafficking.
The country has launched several crypto-based investigations in recent months. One of the most recent incidents is the seizure of $35 million in a crypto OTC scam, as CoinEdition reported. In addition, the authority has also been targeting drug trafficking networks and their involvement in crypto. As per the government, drug dealers and networks are increasingly using cryptocurrencies, VPNs, and encrypted messaging applications to move their funds and conceal the transactions.
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