India’s relationship with cryptocurrency has been far from smooth. Since 2013, the Reserve Bank of India (RBI) has issued repeated warnings about the risks of digital assets. Tensions escalated in 2018 when the RBI imposed a banking ban on crypto businesses, effectively crippling exchanges. However, in a major victory for the crypto industry, India’s Supreme Court lifted the ban in 2020, reigniting hope for digital asset growth in the country.
Despite this legal reprieve, India has continued to impose stringent regulations. In 2022, the government introduced a 30% tax on profits from crypto trading, making the landscape significantly more expensive for traders. To compound the burden, a recent policy announced a 70% tax on undisclosed crypto gains, preventing traders from offsetting their profits with losses. Additionally, individuals transacting over ₹50,000 annually in crypto are now required to pay extra taxes.
Many critics argue that these high taxes are designed to discourage crypto adoption in India. Some government officials even liken cryptocurrency to gambling, often associating it with illegal activities. Yet, despite these hurdles, India’s crypto market has proven resilient. Valued at $2.6 billion in 2024, the sector is expected to grow at a rate of 18.48% per year, reaching an estimated $13.9 billion by 2033.
International pressure is mounting for India to revisit its crypto regulations. Following global developments, such as former U.S. President Donald Trump’s push to explore digital assets, other nations are moving quickly toward more comprehensive crypto frameworks. This shift could prompt India to update its own policies to remain competitive in the global crypto race.
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India is also focusing on developing a central bank digital currency (CBDC), with the RBI launching a pilot program for the digital rupee. However, with high taxes and regulatory barriers, India’s crypto sector faces an uncertain road ahead. The government may need to reevaluate its stance to foster growth and innovation in the industry.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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