- India reassesses crypto policy after G20 following Donald Trump’s pro-crypto stance.
- Bybit reenters India, complying with FIU registration while Coinbase awaits approval.
- High crypto taxes have slowed trading, but India remains a blockchain hub for many.
Major global cryptocurrency exchanges are eyeing a comeback to India, anticipating a potential easing of regulatory restrictions on cryptocurrencies. After its G20 presidency in 2023, India had planned to release a consultation paper on cryptocurrency regulation, however, the release was stalled following Donald Trump’s pro-crypto agenda in the U.S. that prompted Indian policymakers to reassess their approach.
Speaking at the Budget Roundtable 2025, Ajay Seth, secretary of India’s Department of Economic Affairs, acknowledged the evolving global crypto landscape and highlighted the risks posed by digital assets, including stablecoins, and the potential for crypto to facilitate multilateral capital flows. “We were ready with a discussion paper, but we now need to recalibrate it due to these changes,” Seth noted, hinting at a possible shift in India’s regulatory stance.
Despite stringent regulations, India remains a critical hub for blockchain development. According to research by Electric Capital, the country’s share of global blockchain developers has tripled from 4% in 2018 to 12% in 2024, placing it second to the US. Major crypto firms. Coinbase and Gemini, have also established engineering hubs in India, leveraging the country’s talented minds.
The Indian crypto market has faced significant setbacks since the government introduced a 30% tax on digital asset income and a 1% tax deducted at source (TDS) in 2022. These measures led to a sharp decline in trading volumes, driving high-frequency traders and market makers away from local exchanges. Before the tax policy, India was among the fastest-growing crypto markets, primarily fueled by retail investors. Notably, in November 2021, daily trading volumes on WazirX reached $493 million, whereas the same figure is now a struggle despite combining monthly volumes of several exchanges.
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Earlier last month, Coinbase announced its intention to return to the Indian market after its exit in 2022. The exchange’s previous stint ended quickly after its UPI payment integration lasted only three days. Currently, Coinbase is awaiting approval from India’s Financial Intelligence Unit (FIU).
Apart from Coinbase, Bybit had faced regulatory challenges in India following which the exchange was slapped with a $1.06 million fine by the FIU. This fine was charged on account of alleged violation of the provisions of the Prevention of Money Laundering Act (PMLA). In an official announcement, Bybit was accused of providing services to Indian residents without proper registration. After compliance with the authorities, the exchange registered again with the FIU on February 5, 2025.
