India’s cryptocurrency industry is intensifying efforts to convince policymakers to overhaul the nation’s harsh crypto tax regime. At the center of the push is the demand to roll back the 30% capital gains tax and 1% transaction levy introduced in 2022 — rules that reportedly drove over 90% of Indian crypto trading offshore, according to research by the Esya Centre.
Now, amid shifting global dynamics, particularly Donald Trump’s vocal support for cryptocurrencies during his return to the White House, Indian regulators appear to be adopting a more open stance.
Weekly Talks Replace Occasional Meetings
Ashish Singhal, co-founder of crypto platform CoinSwitch, told the Financial Times that interactions between crypto leaders and Indian officials have surged in 2025. “Now regulators are more closely talking to us, understanding what the space is,” Singhal noted, pointing to near-weekly discussions compared to biannual talks in the past.
The Reserve Bank of India (RBI) — once a fierce critic of crypto, now maintains a more neutral tone, according to Singhal. While skepticism remains, the days of comparing crypto to Ponzi schemes appear to be behind us.
Proposals to Replace 1% TDS With 0.1%
Industry leaders are advocating for a reduction of the 1% transaction tax (TDS) to 0.1%, suggesting this would provide transaction traceability without crippling domestic growth.
Despite rising dialogue, India’s February 2025 budget failed to include any tax relief for the crypto industry — a move that disappointed the Bharat Web3 Association. However, Ajay Seth, Secretary of Economic Affairs, confirmed that a redrafted policy paper is in progress.
Legal Pressure and Market Momentum
The Supreme Court of India recently questioned the central government over its delay in creating comprehensive crypto regulations. This legal nudge adds pressure as the industry continues to grow.
Major international players are returning: Binance and Coinbase, who had earlier withdrawn from India, are resuming operations. With the Indian crypto market currently valued at $2.5 billion, forecasts by Grant Thornton predict expansion to $15 billion by 2035.
Perception Gap Still Exists
Despite the increasing institutional engagement, public perception remains a challenge. Many Indians still believe crypto is illegal — a misconception stemming from years of government ambiguity.
However, tech-savvy millennials and Gen Z investors, especially from affluent backgrounds, are showing growing interest in digital assets, positioning India as a potential future crypto hub if regulatory clarity arrives.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are volatile and risky. Always conduct your research before making any investment decisions.
