As of 20 May 2025, cryptocurrencies are not illegal in India, but they are unregulated. The Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), and the Ministry of Finance control and regulate cryptocurrency in India.36 Cryptocurrencies, including Bitcoin and Pi coins, are not recognized as legal tender and cannot be used for everyday purchases or transactions.3 However, trading and investing in cryptocurrencies are legal in India.36
The government of India has proposed taxing digital assets, with a 30% tax on gains from cryptocurrencies and a 1% tax deducted at source.24 Cryptocurrency trading is legal in India, but investors must pay tax on the capital gains according to their tax slab for short-term capital gains (with surcharge and cess) while long-term capital gains are taxed at 20% with indexation benefits.13
A bill titled “Cryptocurrency and Regulation of Official Digital Currency Bill, 2021” was introduced in the Lok Sabha, which proposes prohibiting private cryptocurrencies. However, the bill has not been passed yet.35
In summary, while cryptocurrencies are not illegal in India, they are unregulated and not recognized as legal tender. Trading and investing in cryptocurrencies are legal, but subject to taxation.
