Is crypto legal in India?
Is crypto legal in India? Yes: owning, buying and selling cryptocurrency is legal, but it is not legal tender and it is heavily taxed. Since 2022 India taxes crypto gains at a flat 30% and deducts 1% TDS on transfers, and since 2023 exchanges must register with the Financial Intelligence Unit. Here is what that means in practice, as of October 2026.
Information, not legal or tax advice. Rules change with each budget; check the official sources linked below.
Legal status in one paragraph
There is no law banning crypto in India. In 2020 the Supreme Court struck down the RBI's earlier restriction on banks dealing with crypto businesses. The government calls crypto "virtual digital assets" (VDA), taxes them, and brings exchanges under anti-money laundering rules, but has not made crypto legal tender or passed a full crypto law. A discussion paper and new legislation have been talked about for years.
How crypto is taxed
| Rule | What it means |
|---|---|
| 30% tax on gains (section 115BBH) | Profit from selling or swapping crypto is taxed at 30% plus cess, whatever your income slab. |
| No loss set-off | A loss on one coin cannot reduce tax on another coin or on other income. |
| Only cost of acquisition deductible | Fees and other expenses do not reduce the taxable gain. |
| 1% TDS (section 194S) | Deducted on transfers above the yearly threshold; registered exchanges do it automatically. |
| Gifts and rewards | Crypto received as a gift or reward can be taxable as income. |
The TDS shows in your Form 26AS and can be claimed against your final tax. Report VDA income in the dedicated schedule of your return. Source: Income Tax Department.
Which exchanges are allowed
Since March 2023, crypto platforms serving Indians must register with FIU-IND as reporting entities. In December 2023 FIU-IND issued notices to several offshore exchanges that had not registered, and their websites were blocked; some later registered and paid penalties. Using a registered exchange means KYC, automatic TDS and a legal route for rupee withdrawals. How selling USDT for rupees works: USDT to INR.
RBI and the digital rupee
The Reserve Bank of India remains sceptical of private cryptocurrencies and has warned about their risks many times. Its own digital rupee (e₹) is a central bank digital currency, a form of the rupee, not a cryptocurrency like Bitcoin.
Mining and rewards
Mining crypto is not banned in India, but mined coins and rewards count as VDA when you sell them. Phone "mining" games do not produce Bitcoin; how they work is explained in crypto mining on a phone.
TotalHash is a free mining game in Telegram. You mine the in-game token #TH, and tasks pay small amounts of USD₮ and GRAM to your own TON wallet. If you sell them for rupees, the VDA tax rules above apply.
A free Telegram mining game.
Open TotalHashOther countries: is crypto legal, country by country.
Quick answers
Is bitcoin legal in India?
Yes. Buying, holding and selling crypto is legal, but it is not legal tender.
How much tax do I pay on crypto in India?
30% plus cess on gains, with no loss set-off, and 1% TDS on transfers above the threshold.
Which crypto exchanges are legal in India?
Those registered with FIU-IND as reporting entities.
Is the digital rupee a cryptocurrency?
No. The e₹ is a central bank digital currency, a form of the rupee.