Crypto regulations in India remain uncertain as RBI declines to partake in digital currency governance
The regulatory landscape of cryptocurrencies in India is intricate and ever-changing, marked by an ongoing struggle to establish a definitive framework. Although the Reserve Bank of India (RBI) has previously expressed concerns about crypto's potential risks to monetary policy and financial stability, the situation remains fluid.
Recently, RBI Governor Sanjay Malhotra reiterated the bank's unease, yet a government committee is currently scrutinizing cryptocurrency regulation. The Supreme Court has been pressing for clear regulations, deeming the absence of a proper regulatory framework as a cause of confusion in the digital asset space.
In 2022, India introduced a 30% tax on crypto gains and a 1% TDS on all transactions, making it one of the world’s highest cryptocurrency tax regimes. Crypto exchanges are also classified as "reporting entities" under anti-money laundering (AML) guidelines, necessitating them to report transactions. However, the RBI's stance has been historically stern, viewing crypto as a potential threat to financial stability and an economic system danger.
While the road to comprehensive regulation in India is complex, it appears the country is moving towards aligning its regulations with global standards. By June 2025, the government intends to release a discussion paper outlining various policy options for cryptocurrencies, in response to the pressure from the Supreme Court. Additionally, India is preparing for a Financial Stability Board (FSB) peer review in October 2025, aiming to bring its regulations in line with global norms. Nevertheless, the RBI's past opposition and the Supreme Court's previous rulings have significantly influenced the regulatory environment. As the debate continues, it remains to be seen how India's stance on digital assets will evolve.
- The regulatory landscape of DeFi and crypto technologies in India is marked by an ongoing struggle to establish a definitive framework, with the Reserve Bank of India (RBI) expressing concerns about their potential risks to monetary policy and financial stability.
- Despite the RBI's unease, a government committee is currently scrutinizing cryptocurrency regulation, as the Supreme Court has been pressing for clear regulations in the digital asset space due to the absence of a proper framework.
- In 2022, India introduced a 30% tax on crypto gains and a 1% TDS on all transactions, making it one of the world’s highest cryptocurrency tax regimes, and crypto exchanges are classified as "reporting entities" under anti-money laundering (AML) guidelines.
- Meanwhile, India is moving towards aligning its regulations with global standards, as it aims to bring its regulations in line with global norms during a Financial Stability Board (FSB) peer review in October 2025.
- The RBI's stance has been historically stern, viewing cryptocurrencies as a potential threat to financial stability and an economic system danger, which has significantly influenced the regulatory environment.
- As the debate continues, the evolution of India's stance on digital assets such as Bitcoin, Ethereum, Tron, and token-based businesses remains to be seen.
