Lead: Union minister Jayant Chaudhary disclosed cryptocurrency holdings for a second straight year, highlighting a wider scramble for clarity as cryptocurrency regulation in India remains stalled. Recent survey data from more than 9,000 Mudrex respondents shows strong public demand for rules. Regulators, led by the Reserve Bank of India, continue to voice concerns while the government weighs policy options. The result: entrepreneurs and investors face an uncertain legal and tax landscape in India today.
Why crypto asset disclosure matters
The minister’s repeated crypto asset disclosure signals crypto’s move into the mainstream of public life. Public officials listing digital assets increases transparency and pressure for formal rules. At the same time, disclosure raises questions about conflicts, valuation methods, and tax reporting. For many Indians, these disclosures confirm that cryptocurrency regulation in India can no longer be ignored.
RBI concerns explained
RBI concerns shape policymaking in Delhi. The central bank has warned that broad acceptance of private crypto could undermine monetary control and fragment payments rails. Officials worry about contagion risks and consumer protection. These RBI concerns are a key reason why lawmakers hesitate to adopt a full regulatory framework right now.
UPI and crypto policy
One sticking point is UPI and crypto policy interaction. India’s Unified Payments Interface is a national payment backbone. Regulators fear integrating crypto could complicate settlement and liquidity. Any credible cryptocurrency regulation in India must show how UPI integrity will be preserved while enabling innovation.
Crypto taxation in India
Tax rules have already landed. India taxes crypto at a 30% rate, and a 1% TDS on crypto transactions adds compliance friction. Many traders view the 30% tax on crypto gains as punitive, especially when compared with equity taxation. The combined burden of a 30% tax on crypto gains and the 1% TDS on crypto transactions pushes businesses to seek clarity or relocate.
Web3 policy to bridge gaps
Stakeholders call for a practical Web3 policy that bridges legacy finance and decentralized models. Clear licensing, custody rules, and sandbox regimes would reduce legal uncertainty. A calibrated Web3 policy could unlock new startup capital and make India more attractive to crypto firms and builders.
Path to fintech hub India
Private sector leaders and some policymakers argue that decisive policy clarity could help India become a fintech hub. With talent, capital, and a large domestic market, India has advantages. Thoughtful cryptocurrency regulation in India that balances risk and innovation would protect consumers while encouraging local firms to scale globally.
Practical steps and industry response
Experts recommend short-term fixes: a regulatory sandbox, transparent taxation guidance, and inter-agency coordination. Entrepreneurs already migrate to friendlier jurisdictions that offer clear licensing and custody norms. If Delhi acts, it can minimize capital flight and create domestic opportunities for exchanges, custody providers, and DeFi builders.
Bottom line
The minister’s disclosure, investor surveys, and RBI pushback together show that the issue is urgent. Clear, proportionate cryptocurrency regulation in India will matter for taxation, payments, and India’s role in Web3. Policymakers face a narrow path: guard financial stability while enabling innovation.
Frequently asked questions about cryptocurrency regulation in India (faq)
What is the current tax on crypto in India?
India currently applies a 30% tax on crypto gains and a 1% TDS on crypto transactions. These rules aim to capture revenue but have raised concerns about overburdening traders.
Why does the RBI oppose broader crypto acceptance?
The Reserve Bank of India cites risks to monetary policy, payments stability, and consumer protection. RBI concerns focus on systemic and operational threats from unregulated crypto networks.
How does UPI relate to crypto policy?
UPI is India’s real-time payments system. Regulators worry that integrating private crypto could fragment settlement and affect liquidity across UPI-linked services.
Could India become a fintech hub with clearer rules?
Yes. A balanced Web3 policy and policy clarity would attract startups, preserve capital, and foster innovation, helping India grow as a fintech hub.
What immediate changes would help investors?
Short-term measures like a regulatory sandbox, clearer tax guidance, and custody regulations would reduce uncertainty for investors and firms.
Sources to this article
Mudrex (2025) Mudrex survey on Indian crypto holders. Available at: https://mudrex.com (accessed September 2025).
