Crypto Regulations in India 2025

India’s cryptocurrency landscape in 2025 remains a mix of cautious regulation and rapid adoption. While cryptocurrencies like Bitcoin are not recognized as legal tender, they operate in a regulatory grey area with evolving tax and compliance frameworks. Over 107 million Indians now engage with crypto assets. 

Below is a timeline of key crypto regulation updates in India during 2025, 

Crypto Regulation India Timeline – 2025

• May 22, 2025:
  FSB Peer Review Preparation
  India gears up for the Financial Stability Board (FSB) review in October, aiming to align local crypto regulation with global regulatory standards.
  
• April 1, 2025:
  SEBI Oversight Begins
  SEBI starts monitoring crypto tokens that resemble securities. A multi-agency regulatory model is proposed, including RBI, SEBI, and the Finance Ministry.
  
• February 13, 2025:
  VDA Income Tax Amendment Bill Introduced
  The bill expands the scope of Virtual Digital Assets (VDAs) to include NFTs and undisclosed income. However, the 30% tax rate remains unchanged.
  
• February 10, 2025:
  Crypto Exchanges Declared Reporting Entities
  Exchanges, wallets, and even mining pools are categorized as “reporting entities.” They must report all transactions to tax authorities under the new AML guidelines.
  
• February 1, 2025:
  Union Budget 2025-26 Highlights
  FM Nirmala Sitharaman mandates crypto exchanges to report buyer/seller details under Section 285BAA of the Income Tax Act, enhancing transaction transparency.

Crypto Tax in India – 2025 (Fact-Checked)

As of now, no official reduction has been made to the 30% tax on crypto gains or the 1% TDS, despite industry demands.

1. For Investors and Traders

• Flat 30% Tax on gains from crypto sales, swaps, or gifts.
  No deductions allowed except for cost of acquisition.
  
• 1% TDS on transfers above ₹10,000 (buyer deducts and remits).
  
• No loss set-off or carry-forward permitted.
  

Example:  Buy BTC at ₹2.72 lakh → Sell at ₹8.72 lakh → ₹6 lakh profit → Tax = ₹1.8 lakh + TDS = ₹6,000

2. For Crypto Companies & Exchanges

• KYC/AML compliance is mandatory.
  
• 1% TDS to be collected and remitted on every qualifying user transaction.
  
• Transaction reporting to tax authorities under PMLA and IT laws.
  

Category	Tax Rate	TDS	Example
Investors	30%	1% if >₹10k	₹50k profit → ₹15k tax + ₹500 TDS
Traders	30%	1% if >₹10k	Taxed as business income
Companies	NA	1% collected	₹10L transaction → ₹10k TDS

Crypto Adoption in India (2025 Snapshot)

• Active Users: Over 107.3 million Indians (7.37% of population) hold or trade crypto.
  
• Revenue Forecast: India’s crypto market is projected to hit $6.4 billion by year-end.
  
• Exchanges: Platforms like CoinDCX, CoinSwitch, and Mudrex offer access to over 500 tokens.
  
• Growth Drivers: Rising financial inclusion, smartphone penetration, and blockchain innovation.
  
• Government Holdings: No official disclosure yet; policies prioritize transparency and user safety.

Conclusion

India’s crypto regulation in 2025 reflects a delicate balance between enabling innovation and enforcing oversight. With strict taxes (30% + 1% TDS) and real-time transaction reporting, the government is creating a compliant ecosystem without enforcing an outright ban. As the FSB review nears, clarity in crypto regulation India could open new doors for mass adoption and position the country at the forefront of the $7 trillion global digital economy.

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