India’s crypto investment scene is under pressure. Despite ₹1 crore in current Bitcoin trading volume, the Indian tax regime is stifling growth with its harsh tax policies. Investors once enjoyed a massive 123% gain on Bitcoin holdings in recent years — but now, they’re calling the current tax system “daylight robbery.”
Under India’s current tax regime, crypto profits are taxed at a flat 30%, plus a 4% surcharge. To make matters worse, every crypto trade — regardless of profit or loss — is subject to a 1% TDS (Tax Deducted at Source).
But that’s not all:
This leaves Indian crypto investors with no room for tax planning and no protection for losses, making the landscape extremely restrictive.
Amid this tough environment, Bitcoin ETFs are emerging as a smart alternative for Indian investors looking to save on taxes.
Here’s why Bitcoin ETFs are treated more favorably:
According to some HNIs (High-Net-Worth Individuals), Bitcoin ETF structures can save up to 60% in taxes compared to direct Bitcoin investments.
While ETFs provide a structured route, direct Bitcoin investments still come with regulatory and security concerns:
Despite Bitcoin’s potential, the current tax treatment and lack of regulatory safeguards make direct investment less attractive.
Bitcoin ETFs, on the other hand, offer:
For Indian investors looking to stay in the crypto game without getting crushed by the tax hammer, Bitcoin ETFs could be the smartest move yet.
India imposes a flat 30% tax on crypto gains and a 1% TDS on transfers over ₹10,000, with no loss set-off.
India has a multi-agency approach involving RBI, SEBI, and the Ministry of Finance to oversee various aspects of cryptocurrency.
Yes, from April 1, 2025, SEBI began monitoring crypto tokens resembling securities, aligning with a multi-agency regulatory model.
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