If you’re living in India and wondering whether it’s okay to buy or sell cryptocurrencies, here’s the short answer: Yes, crypto is legal in India. The Supreme Court cleared the way back in 2020 by lifting the RBI’s banking ban on crypto, and since then, people have been free to trade.
But just because something is legal doesn’t mean it’s risk-free.
Let’s break it down.
Crypto is Not Banned, But It’s Not Exactly Welcomed Either
The Indian government hasn’t banned crypto, but it hasn’t fully embraced it either. There’s still no dedicated law that clearly defines how digital assets should be treated. Instead, the government has taken a cautious approach and that caution shows in how crypto is taxed.
Right now, if you make any profit trading crypto, you’re hit with a flat 30% tax. That’s on top of a 1% TDS (tax deducted at source) on every transaction. It doesn’t matter if you made a little or a lot you’re paying up.
This kind of tax setup can drain profits quickly and make active trading feel more like a punishment than an opportunity.
The Trap: Tax and Lack of Regulation
Many young investors jumped into crypto during the 2020–2021 bull market. The promise of fast money and huge returns pulled in crowds. But after the dust settled, many realized they owed more in taxes than they expected, especially those who didn’t track their gains properly.
Add to that the fact that there’s no proper consumer protection, no clear regulatory body to file a complaint with if an exchange freezes your account or if you get scammed. You’re mostly on your own.
So, while you can legally buy and sell crypto, if something goes wrong, there’s no safety net.
Crypto Isn’t the Enemy, But Don’t Go in Blind
To be clear, this isn’t about saying crypto is bad. Blockchain tech has real potential. Bitcoin and Ethereum aren’t going anywhere. But blindly jumping into crypto trading, especially in India’s current system, is risky.
Before trading, ask yourself:
- Do I understand the tax rules?
- Am I keeping records of every transaction?
- Can I handle losing the money I put in?
- Do I know what I’m investing in, or am I just following trends?
If you can’t confidently answer those questions, it might be smart to pause and learn more.
The Bottom Line
Yes, crypto is legal in India but that’s only part of the story.
The bigger picture is more complicated. The taxes are high, the rules are unclear, and the risks are very real. For now, India’s stance on crypto feels more like a warning label than a green light.
So if you’re thinking of trading, go in with your eyes open. Legal or not, crypto might still cost you more than you expect.
