India’s crypto industry has been calling on the government to ease the onerous taxes implemented in 2022 that paralyzed trading. A 30 percent capital gains tax and 1 percent transaction tax pushed more than 90 percent of cryptocurrency trading overseas.
The taxation posed a hostile environment to exchanges such as CoinSwitch, Coinbase, and Binance which are based in the country.
Industry figures like Ashish Singhal of CoinSwitch have witnessed positive indications of a shift in recent months from policymakers in India.
Weekly or monthly meetings with government officials are now held compared to the earlier biannual discussions. The greater engagement reflects a turn in government attitude from that of opposition to digital assets.
Donald Trump’s return to the White House and his support for cryptocurrencies are believed to be influencing India’s softened stance.
Since January, India’s economic affairs secretary Ajay Seth confirmed the government is reworking its crypto policy framework. This has been followed by more frequent industry meetings and wider public discussion about potential reforms.
U.S. Crypto policy drives India’s regulatory shift
India’s Reserve Bank once labeled cryptocurrencies as dangerous to financial stability, even banning services in 2018, which was later reversed.
Today, the central bank is quieter, with new governor Sanjay Malhotra awaiting the government’s revised policy before making statements.
Major exchanges such as Binance and Coinbase have returned to India, perceiving India’s potential over the long haul. The Indian cryptocurrency market has been estimated to reach $2.5 billion in 2024 to $15 billion by 2035 by Grant Thornton.
While optimism has increased, there are still lobbying organizations like the Bharat Web3 Association that are dissatisfied with India’s recent budget not including tax relief.
Leaders including Naga Harish of Mudrex and Suril Desai of Nishith Desai Associates agree that regulatory clarity and lower taxes are vital.
Many younger investors, especially those from wealthy families, are actively embracing digital coins and encouraging their adoption. The coming years may determine whether India becomes a crypto hub or continues losing capital overseas.
