India’s stance on cryptocurrency continues to spark debate. On one hand, the government imposes a steep 30% tax on crypto gains, prohibits offsetting losses, and enforces a 1% TDS on every crypto transaction. On the other hand, it hasn’t outright banned digital assets, leaving the sector stuck between regulation and uncertainty.
India’s crypto industry is divided. While Raj Kapoor, CEO of the India Blockchain Alliance, believes strict rules are better than ambiguity, many crypto players argue for reform. Local exchanges are pushing for:
However, with rising concerns about tax evasion and cybercrime, authorities are hesitant to embrace liberal crypto policies just yet.
The Indian Income Tax Department has issued notices to thousands of individuals who traded digital assets but failed to report them in the FY 2022–23 and 2023–24 tax filings.
Authorities suspect that some traders used crypto as a tool for tax evasion, exploiting the lack of detailed reporting standards during the early days of regulation.
Crypto traders must now correct their filings using the updated return option. CoinDCX Co-founder Sumit Gupta has advised all users to report crypto income, including earnings from airdrops or global exchanges, and emphasized the need to stay compliant.
India’s current crypto tax policy includes:
Due to these tough regulations, top global exchanges like OKX have exited the Indian market. Even homegrown platforms feel the pressure, urging policymakers to reconsider the TDS rate and revise the tax structure to promote growth and investment.
India’s reluctance to ease crypto regulations stems in part from the rise in crypto-linked cybercrimes.
The Central Bureau of Investigation (CBI) has now built in-house systems to track and seize crypto, signaling the government’s focus on creating a safer crypto environment before relaxing policies.
India isn’t against crypto, but it’s not fully embracing it either. With tax notices being sent, foreign platforms exiting, and cybercrimes increasing, the focus remains on compliance and safety rather than rapid liberalization. Until India establishes a robust regulatory framework, a truly crypto-friendly economy might remain out of reach.
Yes, crypto is legal to own and trade in India, but it’s not recognized as legal tender. It’s classified as a Virtual Digital Asset (VDA).
Yes, crypto gains are taxed at a flat 30% in India, along with a 1% TDS on transactions over ₹10,000. No loss offsetting is allowed.
Multiple bodies regulate crypto in India, including the Ministry of Finance, RBI, SEBI, and FIU-IND, focusing on taxation, AML, and financial stability.
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