While India does not recognize cryptocurrencies as legal tender trading and investing in them is legal in 2025. The Income Tax Bill 2025 classifies Virtual Digital Assets (VDAs), including crypto and NFTs, as property and capital assets, subjecting them to a 30% capital gains tax and a 1% TDS on transactions above ₹50,000 (₹10,000 in some cases).
This bill aims to align India's tax structure with global practices where digital assets are often treated as property or securities. It also allows tax authorities to track and seize VDAs in cases of tax evasion, ensuring these assets don't remain outside regulatory oversight. However, a comprehensive regulatory framework specifically governing cryptocurrencies is still under development.