India is currently in a pivotal phase of shaping its crypto policy.The rise of crypto growth in india is visible although The government plans to release a discussion paper on cryptocurrency this month to gather public feedback on how to regulate the industry. This move comes amid growing global momentum—especially after countries like the U.S. and Pakistan announced strategic crypto initiatives
ðŸ›ï¸ Policy Landscape
The Indian government is preparing to release a long-awaited discussion paper on cryptocurrency, aiming to gather public and industry feedback before drafting a comprehensive regulatory framework. Its expected to address:
- Licensing and registration of crypto firms
- Investor protection mechanisms
- KYC/AML compliance
- Taxation reforms, including a potential reduction of the 1% TDS to 0.01%
💸 Current Taxation & Legal Status
- Crypto is legal to own, trade, and mine—but not legal tender.
- Gains are taxed at 30%, with 1% TDS on every transaction.
Here are some key developments:
- Crypto is legal but not recognized as legal tender in India. You can trade and hold it, but you can’t use it to buy your morning chai.
- The government currently imposes a 30% tax on crypto gains and a 1% TDS on transactions, which many argue is stifling domestic exchanges.
- Regulatory bodies like SEBI and RBI are involved. SEBI has proposed a multi-regulator framework, while the RBI remains cautious and is focusing on its own Central Bank Digital Currency (CBDC).
- The upcoming policy paper is expected to address investor protection, licensing, KYC/AML compliance, and possibly a reduction in the 1% TDS to encourage local trading.
It’s a bit of a regulatory balancing act—India wants to foster innovation while protecting investors and maintaining financial stability. Crypto growth in india is witnessing robust momentum, driven by rising retail adoption and government engagement with regulation. As digital assets integrate into fintech and startup ecosystems, the market continues to expand rapidly.