Indian Coinsecure Reports USD 3 Million in Insider Theft

The largest Indian crypto exchange accuses its Chief Scientific Officer for the theft

by Marin Marinov
12 April • 4 min
In News

Indian Coinsecure, one of the leading crypto exchanges globally, officially disclosed a USD 3 million in insider theft on Thursday. The company accused Dr. Amitabh Saxena, its Chief Scientific Officer (CSO), in a complaint filed with the Delhi Police`s Cyber D Crimes Unit.

The user funds have been stolen from Coinsecure wallets during a process to extract coins and distribute them to clients, according to the company.

“Our CSO, Dr. Amitabh Saxena, was extracting BTG [Bitcoin Gold] and he claims that funds have been lost in the process during the extraction of the private keys,” Coinsecure explained on its website.

The largest Indian-based crypto exchange reported the problem to its users on Tuesday with a request to stop depositing Bitcoin (BTC) into Coinsecure wallets with immediate effect and until further notice.

The company claims that its system is secure and has not been hacked or compromised. It insists that the CSO has stolen the funds. Coinsecure’s internal rules give the right to the CSO and to the Chief Executive Officer (CEO), Dr. Mohit Karla, to keep the private keys for the Bitcoin wallet, where user funds are stored.

coinsecure

Official accusation

Secure Bitcoin Traders Pvt Ltd, Coinsecure’s parent company, filed the exchange`s First Information Report (FIR) to the police, directly accusing Saxena for the theft and warning the police of his possible running out from India:

“As the private keys are kept with Dr. Amitabh Saxena, we feel that he is making a false story to divert our attention and he might have a role to play in this entire incident. Dr. Amitabh Saxena also has an Indian Passport and he might fly out of the country soon, therefore his passport should be seized so he can not fly out of the country,” Karla wrote in the complaint to the New Delhi Police.

This is the first publicly announced crypto-related complaint to the Cyber Crimes Unit after December New Delhi Police`s warning to citizens to avoid Bitcoin. “These currencies are normally used by criminals operating on the dark web or the hidden web. Legal, bonafide businesses do not normally use bitcoins. Therefore, any request for business transaction in bitcoins should raise suspicious and should be avoided," the Cyber Crimes Unit alerted on a Facebook Post last year.

Coinsecure`s disclosure of the internal theft also came days after the Indian National Bank banned financial institutions like banks, payment service providers and other financial companies from dealing with cryptocurrencies.

Who is Dr. Amitabh Saxena?

Dr. Saxena, a former professor of Computer Science in Australia, was appointed as Coinsecure CSO in September 2012. Saxena has also worked for Accenture and Hewlett Packard.

“Among the few early adopters in the cryptocurrency ecosystem, Dr. Saxena has also contributed scientific articles based on his research in the blockchain space. He comes with an extremely strong understanding of the crypto space and has a lot of ideas and implementations that he will be bringing to Coinsecure,” the Indian crypto exchange said upon his appointment.

Now, Coinsecure appeals to users for support: “we are hoping that as users of Coinsecure, you will stand by us in this hour of need by providing us with your help and support,” the company said on its website.

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