Is crypto legal in India? The RBI ban, the 2020 court ruling, the 30% tax and FIU-IND registration
Is crypto legal in India?
Owning and trading crypto is legal in India. The RBI's 2018 ban on banks serving crypto firms was set aside by the Supreme Court on 4 March 2020, gains are taxed at 30% under a 2022 amendment with 1% TDS on transfers, and since March 2023 exchanges serving Indians must register with FIU-IND or face blocking.
Piece published Reviewed by CryptoGuardz Register Desk, editorial desk
Crypto is legal to own and trade in India. No central statute read for this page bans it. The Reserve Bank of India's 2018 order cutting crypto firms off from banks was set aside by the Supreme Court on 4 March 2020, crypto gains are taxed at 30% with 1% TDS on transfers, and since March 2023 any exchange serving Indians must register with FIU-IND.
So "is bitcoin legal in India" gets a yes with conditions attached. The state taxes it, watches it through an anti-money-laundering register, and blocks the exchanges that do not sign up. This page reads the primary documents on each of those points. It is not legal or tax advice.
Did India ever ban crypto?
The banking system was barred from it for just under two years. On 6 April 2018 the RBI issued circular RBI/2017-18/154, titled "Prohibition on dealing in Virtual Currencies (VCs)". It did not make crypto illegal for a person. It cut off the banks:
it has been decided that, with immediate effect, entities regulated by the Reserve Bank shall not deal in VCs or provide services for facilitating any person or entity in dealing with or settling VCs.
Banks already serving crypto firms were told to "exit the relationship within three months from the date of this circular." Exchanges lost their rupee rails, and most of the Indian market moved to peer-to-peer trades.
What did the Supreme Court decide in 2020?
It struck the circular down. The case is Internet and Mobile Association of India v. Reserve Bank of India, Writ Petition (Civil) No. 528 of 2018, decided on 4 March 2020. The judgment was written by V. Ramasubramanian, J. The copy served by the court's own server truncates at paragraph 6.52 in two attempts, before the operative part, so this page does not quote the court's conclusion directly: not verified from the judgment itself.
The RBI's own later circular records the outcome. Circular RBI/2021-22/45 of 31 May 2021 says the 2018 circular was "set aside by the Hon'ble Supreme Court on March 04, 2020", that it "is no longer valid from the date of the Supreme Court judgement" and that it "cannot be cited or quoted from." The same 2021 circular tells banks they may "continue to carry out customer due diligence processes" on crypto customers, in line with KYC, AML and CFT rules under the Prevention of Money Laundering Act.
How does India tax crypto?
Heavily, and with no relief for losses. Two sections of the Income-tax Act 1961 carry the regime. The department's footnote to section 115BBH says it was "inserted by the Finance Act, 2022, w.e.f. 1-4-2023"; the page for section 194S carries no insertion note: not verified.
| Rule | Section | What it says |
|---|---|---|
| 30% flat tax on gains | 115BBH | Inserted by the Finance Act 2022, from 1 April 2023 |
| No deductions | 115BBH(2)(a) | Only cost of acquisition may be deducted |
| No loss set-off | 115BBH(2)(b) | Losses cannot be set off or carried forward |
| 1% TDS on transfers | 194S | One per cent of the consideration |
| TDS threshold | 194S(3) | Rs 50,000 a year for a specified person, Rs 10,000 for others |
Section 115BBH(1) charges income "from transfer of such virtual digital asset at the rate of thirty per cent". Sub-section (2)(b) says a crypto loss shall not be set off "against income computed under any provision of this Act" and "shall not be allowed to be carried forward". A trader who makes Rs 1 lakh on one coin and loses Rs 1 lakh on another pays tax on the first lakh.
The Income-tax Act 2025 replaced the 1961 Act from 1 April 2026. The Income Tax Department's transition FAQs say "The 1961 Act stands repealed on the 01.04.2026" and that "Income earned during the FY 2025-26 will be governed by the Income-tax Act, 1961". The detail of how the 30% rate and the TDS carry into the new Act is in the India crypto tax guide.
Do exchanges need to register in India?
Yes, with the Financial Intelligence Unit, since March 2023. FIU-IND's guidelines of 10 March 2023 rest on a Ministry of Finance notification "F.No. P-12011/12/2022-ES Cell-DOR dated March 07, 2023" that brings five crypto activities under the Prevention of Money Laundering Act: exchange between crypto and fiat, exchange between crypto assets, transfer, safekeeping, and services tied to token sales. The guidelines say "all SPs are required to register as Reporting Entities with FIU-IND". They do not spell out the position of offshore firms. The enforcement record does.
Which offshore exchanges did FIU-IND act against?
Forty-nine named service providers in three rounds, plus a penalty. Every release cites section 13 of the PMLA.
| Date | Action | Count | Registered with FIU-IND |
|---|---|---|---|
| 28 December 2023 | Show cause notices; MeitY asked to block URLs | 9 | 31 |
| 31 January 2025 | Rs 9.27 crore penalty on Bybit | 1 | not disclosed |
| 1 October 2025 | Non-compliance notices; takedown of apps and URLs | 25 | 50 |
| 9 September 2026 | Non-compliance notices; takedown of apps and URLs | 15 | not disclosed |
The December 2023 release named Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global and Bitfinex. The Director of FIU-IND wrote to the Secretary of MeitY seeking action "to block the URLs of said entities that are operating illegally." Seven of those nine are on the CryptoGuardz exchange register: Binance, KuCoin, HTX (formerly Huobi), Kraken, Gate, Bitstamp and MEXC.
The Bybit order of January 2025 states the reason flat: "Bybit kept expanding its services in the Indian market without securing mandatory registration with the FIU-IND." The release adds that FIU-IND had Bybit's websites blocked through MeitY. Bybit is on the register too.
The October 2025 list of 25 includes BC.game, which this register tracks as a casino, at the BC.GAME entry. Both 2025 and 2026 releases rely on section 79(3)(b) of the IT Act for the takedown notices. Whether any named firm has since registered is not stated in the releases: not verified.
The register added three Indian exchanges on 9 October 2026. CoinDCX claims FIU-IND registration VA00030982 and WazirX claims VA00031068; ZebPay's documents read state no number. None was confirmed in an FIU-IND list, which could not be read. An FIU-IND registration is an anti-money-laundering reporting registration, not a licence: India has no licensing regime for crypto exchanges as of those records.
Is crypto legal tender in India?
No statute read for this page makes it so, and the RBI's 2018 circular treated it as something banks should not touch. Legal to hold is not the same as accepted for payment. The 30% tax and the 1% TDS treat a coin as a "virtual digital asset", a defined category of property, not currency.
Does legal crypto mean legal crypto gambling?
No. Since August 2025 a separate Act governs that question. Section 5 of the Promotion and Regulation of Online Gaming Act 2025 says "No person shall offer, aid, abet, induce or otherwise indulge or engage in the offering of online money game", and the Act defines an online money game by the stake, whether it is paid in money "or other stakes". A crypto deposit is still a stake. Section 7 bars any person "facilitating financial transactions" from processing payments for such games.
Buying bitcoin on a registered exchange is lawful. Sending it to an offshore casino puts the operator on the wrong side of section 5. The detail, and what the register's casinos say about India in their own terms, is in India's Online Gaming Act 2025 and on the India country page.
What this does not show
The operative paragraphs of the 2020 judgment were not read; the outcome is taken from the RBI's 2021 circular. No draft crypto bill was read. The registration status of the firms named in FIU-IND notices after each release is not verified. State laws are not covered.
Quick answers
Is crypto legal in India?
Yes. Owning and trading crypto is not banned by any central statute read on 9 October 2026. Gains are taxed at 30% and exchanges must register with FIU-IND. See the exchange register.
Is bitcoin legal in India in 2026?
Yes, on the same terms. The RBI's 2018 bank ban was set aside on 4 March 2020, and the RBI said in 2021 the circular "cannot be cited or quoted from."
Did the RBI ban cryptocurrency?
It barred banks from serving crypto firms from 6 April 2018, with three months to exit. It never made holding crypto an offence, and the order was set aside in 2020.
Is Binance legal in India?
FIU-IND sent Binance a show cause notice on 28 December 2023 and asked MeitY to block its URLs. Its current registration status is not verified. See the Binance entry.
Where can I get help with gambling in India?
Gambling Therapy offers free international support at gamblingtherapy.org. More options are on the responsible gambling page.
Sources
- Reserve Bank of India, Prohibition on dealing in Virtual Currencies (VCs), RBI/2017-18/154, 6 April 2018, retrieved 9 October 2026
- Reserve Bank of India, Customer Due Diligence for transactions in Virtual Currencies (VC), RBI/2021-22/45, 31 May 2021, retrieved 9 October 2026
- Supreme Court of India, Internet and Mobile Association of India v. Reserve Bank of India, W.P. (C) No. 528 of 2018, judgment of 4 March 2020, read in part, retrieved 9 October 2026
- Income Tax Department, Income-tax Act 1961 section 115BBH, retrieved 9 October 2026
- Income Tax Department, Income-tax Act 1961 section 194S, retrieved 9 October 2026
- Income Tax Department, FAQs on the transition to the Income-tax Act 2025, retrieved 9 October 2026
- FIU-IND, AML and CFT guidelines for reporting entities providing services related to virtual digital assets, 10 March 2023, retrieved 9 October 2026
- PIB, FIU IND issues compliance show cause notices to nine offshore VDA SPs, 28 December 2023, retrieved 9 October 2026
- PIB, FIU-IND imposes monetary penalty on Bybit Fintech Limited, 31 January 2025, retrieved 9 October 2026
- PIB, FIU IND issues notices for non-compliance to 25 offshore VDA SPs, 1 October 2025, retrieved 9 October 2026
- PIB, FIU-IND issues notices for non-compliance to 15 VDA SPs, 9 September 2026, retrieved 9 October 2026
- The Promotion and Regulation of Online Gaming Act, 2025 (Act No. 32 of 2025), India Code, retrieved 9 October 2026
- CryptoGuardz exchange register, entity and registration records including CoinDCX, WazirX and ZebPay, retrieved 9 October 2026
- Gambling Therapy
About this piece
Compiled by the CryptoGuardz register team from the sources listed above. Research and drafting are AI-assisted and reviewed by a named editor before publication. Nothing here is a recommendation to gamble. If a figure or a reading is wrong, tell us and the correction is logged in public.