India Crypto Regulation: Rules, Risks, and What It Means for Users in 2025

When it comes to India crypto regulation, the government’s stance is clear: crypto isn’t illegal, but it’s not recognized as legal tender either. Also known as Indian cryptocurrency laws, this framework lets you hold coins but makes it hard to use them like cash—banks won’t touch crypto transactions, and exchanges operate under constant scrutiny. Unlike countries that outright ban digital assets, India walks a tightrope—taxing gains heavily while avoiding a full crackdown.

This balancing act affects everyone. If you’re holding Bitcoin or Ethereum, you’re subject to a 30% tax on profits, no deductions allowed. That’s higher than most countries. And if you trade on an exchange like WazirX or CoinSwitch, you’re dealing with KYC checks that feel more like a bank audit than a crypto platform. The RBI crypto policy, the Reserve Bank of India’s official position, has never changed: banks must avoid crypto-related business. That means no easy bank links, no instant INR deposits, and no protection if an exchange collapses. Meanwhile, the crypto taxation India, a 1% TDS on all crypto trades since July 2022. Also known as crypto transaction tax India, this rule hits every buy and sell—even small swaps between tokens. It’s not about stopping crypto; it’s about tracking it.

There’s no law saying you can’t own crypto, but there’s no law protecting you if you lose it. Courts won’t help if you get scammed. Exchanges aren’t required to insure your funds. And if you mine Bitcoin or run a node, you’re in a gray zone—no one’s arrested you, but no one’s saying it’s legal either. The government keeps talking about a digital rupee, but that’s not crypto—it’s a state-controlled version of money. For users, that means the future isn’t about freedom—it’s about compliance.

What you’ll find below are real stories from Indian crypto holders: how they navigate the tax system, which exchanges still work despite the rules, what scams are targeting new users, and why some people are moving their holdings offshore. No fluff. No theory. Just what’s actually happening on the ground in 2025.