India’s cryptocurrency market continues to attract investors despite regulatory uncertainty, high taxes and concerns over financial stability. An OECD report released in June 2026 said India and South Korea recorded the largest absolute inflows into crypto assets in the 12 months to June 2025.
India’s Virtual Digital Asset (VDA) market has also expanded. According to data cited from the finance ministry, VDA transaction value reached ₹1,09,580 crore between FY23 and FY25, representing 131% cumulative growth.
Younger investors and participants from smaller cities are playing a major role. WazirX data cited in the report showed more than 82% of users came from non-metro cities, while CoinSwitch reported that nearly three in four Indian crypto investors were below 35 in Q2 2026.
However, crypto trading remains subject to significant taxation. India imposes a 30% tax on income from VDA transfers, along with a 1% TDS on transactions. Losses generally cannot be offset against other income or carried forward. Around 73% of Indian crypto trading volume reportedly shifted to offshore platforms in FY25, according to KoinX data cited by Mudrex.
Regulatory clarity remains a key issue. The RBI continues to express concerns about cryptocurrencies, while the government has focused on taxation, reporting and anti-money-laundering compliance.
The Parliamentary Standing Committee on Finance has also examined the regulatory gap surrounding VDAs. With adoption continuing, a clearer framework could shape how investors, exchanges and financial institutions participate in India’s evolving crypto ecosystem.
