India’s Finance Minister, Anurag Thakur, has clarified that the country has not enacted any law explicitly banning cryptocurrency. Despite widespread speculation and ongoing discussions around regulatory crackdowns, Thakur emphasized that no specific legislation currently prohibits the use or trading of digital assets in India.
This statement comes amid growing public and industry concern following reports earlier this year about a proposed draft bill aiming to ban private cryptocurrencies. On April 25, sources revealed that various government departments were reviewing the “Cryptocurrency and Regulation of Official Digital Currency Bill, 2019”—a framework that, if passed, could outlaw all non-state-backed digital currencies.
However, as of now, there is no enforceable law banning cryptocurrency in India, according to the Finance Minister’s recent remarks during a session in the Rajya Sabha—the upper house of India’s Parliament.
Parliament Questions Spark Regulatory Clarity
The clarification arose after MP Dharmapuri Srinivas questioned Thakur on whether cryptocurrency is legally prohibited in the country. Srinivas also raised concerns about enforcement actions and public awareness:
“Is the government aware of the widespread presence of cryptocurrency in India? And if so, what actions have been taken against individuals or entities operating crypto platforms?”
Thakur responded clearly: no formal ban exists. He explained that while discussions around a comprehensive regulatory framework are ongoing, there is currently no dedicated legal statute targeting cryptocurrency activities.
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He further noted that any action taken against crypto-related activities must be grounded in existing laws—such as those related to taxation, money laundering, or financial fraud—and enforced by agencies like the Reserve Bank of India (RBI), Enforcement Directorate (ED), or Income Tax Department.
This means that while crypto trading isn’t illegal per se, operations violating anti-money laundering (AML) norms or evading tax compliance can still face penalties under current statutes.
The Status of the Proposed Crypto Ban Bill
A leaked version of the “Banning of Cryptocurrencies and Regulation of Official Digital Currency Bill” had previously sparked panic in India’s crypto community. According to reports from CoinTelegraph and other outlets, the draft proposed criminalizing the use, issuance, mining, and trading of private cryptocurrencies.
Under the draft definition:
“Any digital representation of value created through cryptographic means or otherwise, which functions as a digital store of value, unit of account, or medium of exchange—but does not constitute legal tender”—would be classified as a cryptocurrency.
Notably, the bill would allow the Indian government to issue its own Central Bank Digital Currency (CBDC), known as the digital rupee, while banning all other decentralized alternatives.
Yet, despite these proposals being discussed since 2019, the bill has never been tabled in Parliament. Its repeated delays suggest internal disagreements within the government regarding how best to regulate—or restrict—the rapidly evolving digital asset space.
Regulatory Uncertainty vs. Market Reality
While lawmakers deliberate, India’s crypto market continues to grow. The country ranks among the top global adopters of blockchain technology and digital assets, with millions of retail investors actively participating in crypto trading.
According to industry estimates, Indian users hold over $2 billion worth of digital assets across various exchanges. This growing adoption highlights a stark contrast between legislative hesitation and real-world usage.
Many startups and fintech innovators argue that instead of an outright ban, India should follow models like those in Switzerland or Singapore—jurisdictions that balance innovation with investor protection through clear regulatory sandboxes and licensing frameworks.
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In fact, members of India’s blockchain community have formally recommended incorporating elements of Swiss crypto policy into domestic regulation—advocating for clarity, proportionality, and technological neutrality.
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Frequently Asked Questions (FAQ)
Is cryptocurrency banned in India?
No. As of 2025, there is no official law banning cryptocurrency in India. While draft legislation has been discussed, none has been passed by Parliament. Trading and holding digital assets remain legally permissible under current frameworks.
Can I invest in crypto in India?
Yes. Individuals can legally buy, sell, and hold cryptocurrencies. However, profits from such investments are subject to capital gains tax—currently taxed at 30% plus applicable surcharges and a 1% TDS (Tax Deducted at Source) on transactions.
What is the digital rupee?
The digital rupee is India’s central bank digital currency (CBDC), issued by the Reserve Bank of India. It is a legal tender in electronic form and aims to provide a secure, government-backed alternative to private cryptocurrencies.
Has the Indian government taken any action against crypto exchanges?
Yes—but not based on a crypto ban. Regulatory bodies like the Income Tax Department and Enforcement Directorate have conducted investigations into tax evasion and suspicious transactions involving certain exchanges. These actions are rooted in financial compliance laws, not an outright prohibition.
Could India ban cryptocurrency in the future?
It remains possible but unlikely in the near term. With increasing adoption and global regulatory trends moving toward oversight rather than prohibition, experts believe India will eventually introduce a regulated framework instead of an outright ban.
How does India’s stance compare to other countries?
India’s position is cautious but not exceptional. Unlike China, which enforces a strict ban on crypto transactions, India allows usage while imposing taxes and monitoring for illicit activity—similar to approaches seen in the U.S., Japan, and parts of Europe.
👉 Compare international crypto regulations and their economic impacts now.
Final Outlook: Toward Regulation Over Prohibition
India stands at a crossroads. On one hand, concerns over financial stability, money laundering, and consumer protection drive calls for tighter controls. On the other, technological innovation, youth-driven investment trends, and blockchain’s transformative potential push for balanced regulation.
The Finance Minister’s recent comments signal a critical truth: cryptocurrency is not illegal in India. Instead of prohibition, the focus appears to be shifting toward developing a robust regulatory system—one that fosters innovation while safeguarding national interests.
As discussions continue behind closed doors, one thing is clear: clarity is urgently needed. Investors, entrepreneurs, and regulators alike await a definitive framework that acknowledges both risk and opportunity.
Until then, market participants should stay informed, comply with existing tax obligations, and prepare for potential regulatory changes—all while recognizing that India has not banned cryptocurrency.