Update (Sept. 12, 2025, at 2:20 pm UTC): This article has been updated to add commentary by Anmol Jain, India-based vice president of investigations at crypto forensics firm AMLBot.
Indian regulators are reportedly holding back from introducing comprehensive crypto rules over concerns that regulation could legitimize digital assets and create systemic risks.
According to a Wednesday Reuters report citing documents the outlet’s reporters viewed, the Reserve Bank of India (RBI) maintains the view that containing the risks posed by cryptocurrencies through regulation would be challenging.
The document reportedly states that regulating cryptocurrencies would legitimize them and “cause the sector to become systemic.” An outright ban on cryptocurrencies, the document continued, would address the alarming risks of speculative crypto assets but could not tackle peer-to-peer transfers or trades on decentralised exchanges.
Currently, India lacks comprehensive crypto regulation, but it has imposed certain restrictions.
Anmol Jain, India-based vice president of investigations at crypto forensics firm AMLBot, told Cointelegraph that the report is in line with “India’s long-term posture on crypto.” He explained that it reflects a consistent strategy of avoiding conferring legitimacy through clear regulation and keeping partial oversight instead.
Jain also noted that local regulators rely on punitive taxes to deter speculation and mass participation in the crypto industry. He concluded:
“An enforcement-led, case-by-case approach remains the baseline. While positions can evolve, nothing here contradicts India’s observable trajectory.“
Related: Crypto taxes in India, explained: What traders need to know in 2025
India’s current crypto rules
While India lacks clear rules for crypto, the government imposes a 30% tax on digital asset gains and requires registration with local regulators for foreign crypto exchanges. At the end of 2023, India’s Financial Intelligence Unit (FIU) requested that blocks be placed on global crypto exchanges Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global and Bitfinex for failing to register.
Both Binance and competitor exchange KuCoin returned to the country in 2024 after obtaining approval from the FIU to offer their services in India. The regulators also impose Anti-Money Laundering (AML) rules on locally operating crypto businesses.
Related: Coinbase legal team meets Indian Minister to discuss blockchain push
India’s growing crypto adoption
Despite the country’s apparent hostility to the cryptocurrency industry, it leads in crypto adoption. The 2025 Geography of Crypto Report, recently published by crypto forensics firm Chainalysis, revealed that India leads in crypto adoption across all categories.
Government officials have also disclosed holdings. Minister Jayant Chaudhary reported that his crypto portfolio grew 19% to about $25,500.
Still, industry figures say the country faces a gap between adoption metrics and actual usage. “The fact that metrics say one thing, and reality presents a contrasting image, suggests that India stands at a paradoxical crossroads,” said Mithil Thakore, CEO of crypto platform Velar.
Magazine: India mulls new crypto ban to support CBDC, Lazarus Group strikes again: Asia Express