In a major development for the Indian crypto industry, the Supreme Court of India has asked the central government to explain why cryptocurrency trading cannot be regulated in the country. This comes at a time when millions of Indians are investing in digital currencies like Bitcoin, Ethereum, and many others, but still face confusion due to unclear government policies.
Let’s break down what this means and how it can affect crypto users and traders in India.
What Did the Supreme Court Say?
On May 17, 2025, the Supreme Court asked the central government a straightforward question — Why can’t you regulate crypto trading instead of banning or ignoring it?
This question came while hearing a petition that raised concerns about online cryptocurrency scams. The petitioner argued that many people are falling victim to fake crypto apps and fraud because there is no proper regulation from the government.
The Supreme Court said that if crypto trading is happening across the country, why isn’t there a legal framework to control or monitor it? They also said that doing nothing can be more dangerous because it gives scammers a free hand.
Why Is This Important?
India has had a love-hate relationship with cryptocurrency:
In 2018, the RBI (Reserve Bank of India) banned banks from dealing with crypto businesses.
In 2020, the Supreme Court lifted this ban, saying it was unfair.
Since then, crypto trading has grown massively in India, but no clear law has been made to regulate it.
This unclear situation creates problems for:
Investors and traders who don’t know what is legal or not.
Companies that want to build crypto platforms.
Law enforcement agencies want to catch scammers.
Now, the Supreme Court is telling the government that this can’t go on forever. People need clear rules and protection.
Government's Stand on Crypto
The Indian government has taken a cautious approach toward cryptocurrency. It has:
Imposed a 30% tax on crypto profits.
Added 1% TDS on crypto transactions.
Warned people about the risks of crypto investment.
But so far, it has not introduced any law to regulate crypto exchanges or protect users from fraud. The Finance Ministry has said many times that a global agreement is needed before making a final decision.
However, the recent action by the Supreme Court might force the government to act faster.
What Does This Mean for Crypto Users?
If the government listens to the Supreme Court and creates proper regulations, it can be very good news for crypto users in India.
Here’s how:
Less risk of scams: With proper laws, fake apps and fraudsters can be punished.
More trust: People will feel safer investing in crypto.
Growth for businesses: Crypto exchanges and start-up will grow with legal clarity.
Innovation: More Indian companies can work on blockchain and crypto tech.
But if the government delays again, the situation will remain risky and confusing.
Final Thoughts
The Supreme Court’s question is a strong signal to the government: It’s time to regulate, not ignore crypto. With millions of Indians already involved in crypto trading, proper laws can help the entire industry grow safely.
Crypto is not just a trend — it is the future of finance. Instead of pushing it away, India needs to build a system that protects users and encourages innovation.
As the legal battle continues, crypto investors should stay updated and trade on secure platforms like UPB Crypto Bank, which provides reliable and compliant crypto services.
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