India’s Crypto Industry Goes Full Lobby Mode—Tax Cuts or Bust
New Delhi’s digital asset players are turning up the heat on policymakers. After years of regulatory whiplash, exchanges and blockchain firms are pooling resources to push for friendlier tax policies—because nothing says ’innovation’ like begging for a break from the taxman.
The ask? Slash the 30% capital gains levy and kill the 1% TDS on transactions. Critics call it special treatment; insiders argue it’s survival. Meanwhile, traditional finance snickers from the sidelines—turns out even decentralized rebels need daddy government’s approval.
India increases crypto engagement as global trends shift
The government’s outlook on digital assets is changing. Execs said the frequency with which crypto firms met with policymakers had spiked noticeably. Singhal said the engagement has turned from once every six months to “monthly, if not weekly.”
The shift also arrives as Donald Trump, the US president, sits at the head of the table and embraces digital currencies. Indian industry leaders say the global momentum — especially in the US — is swaying policy discussions in India.
In the weeks after TRUMP took office in January, there were reports that India’s Economic Affairs Secretary Ajay Seth planned to redraft a pivotal discussion paper that may be the foundation for future crypto rules. Seth has not spoken publicly since, but the steps point to Indian regulators rethinking their approach to the sector.
India’s crypto industry has long existed under a cloud of regulatory uncertainty. The Reserve Bank of India (RBI), once a vocal opponent of digital currencies, had prohibited banks from serving cryptocurrency firms in 2018. The Supreme Court overturned that ban in 2020.
Today, RBI’s language has mellowed. Though the central bank remains concerned about the potential risks that digital assets poses to financial stability, its current governor, Sanjay Malhotra, has shunned the harsh language of his predecessors. The relationship has moved from “negative to neutral” alongside RBI, noted Singhal of CoinSwitch, a sign of potential room to work together.
India lets major crypto exchanges re-enter market
Some leading global crypto exchanges are re-entering India as the country’s regulations are becoming more favorable for the industry.
Coinbase, the biggest US-based exchange, has registered with the FIU-IND and can now open in India. The MOVE comes after the brief withdrawal of Coinbase in 2022 when it said it was unclear on regulatory and payment processing fronts.
Binance, the largest crypto exchange in the world, has also made a re-entry into the Indian market after partnering with the very same financial oversight body. The registrations are a major reversal, with the regulators now emphasizing compliance and oversight rather than outright bans.
Tom Duff Gordon, Coinbase’s head of international policy, said Trump’s comeback has inspired confidence in the global crypto sector. He added that the Indian government now understands they cannot ban crypto anymore.
According to Grant Thornton, India’s crypto market will increase from $2.5 billion in 2024 to over $15 billion in 2035.
“Competition has definitely started heating up,” said Kush Wadhwa, partner at Grant Thornton’s Indian arm. “India doesn’t have any option but to adopt it, but the problem for them is money laundering and tax evasion — they’re not saying ‘don’t do it’, but they want a control on it.”
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