How is crypto regulated in India?

Crypto regulation in India works through money laundering law rather than a full licensing regime. As of October 2026, owning and trading crypto is not banned, but crypto is not legal tender, and any business that exchanges, transfers or holds crypto for Indian users must register with the Financial Intelligence Unit (FIU-IND) and follow its rules.

Is crypto legal in India?

Yes, holding and trading crypto is legal, but crypto is not legal tender. India treats crypto as a "virtual digital asset" (VDA), a term defined in its income tax law in 2022. That definition is mainly used for taxation, which is covered in our guide on how crypto is taxed in India.

The Finance Ministry has also warned that crypto products and NFTs remain unregulated and highly risky, and that buyers have no regulatory recourse if they lose money. In other words, being legal is not the same as being protected.

What is FIU registration for crypto in India?

In March 2023, the government brought VDA activities under the Prevention of Money Laundering Act, 2002 (PMLA). That made crypto exchanges, wallet providers and custodians "reporting entities," and they must register with FIU-IND, which sits under the Ministry of Finance.

Registered platforms must verify customers, keep client and transaction records for five years, and report suspicious transactions. Guidelines reported in January 2026 tightened onboarding further. They call for a live selfie with liveness checks, a PAN card plus a second ID, phone and email verification, and a small bank account check. KYC must be refreshed every six months for high-risk users and yearly for others. The guidelines also prohibit facilitating crypto mixers and tumblers and strongly discourage ICOs. For background on these checks, see what KYC is.

The rules apply to offshore platforms too. On September 9, 2026, FIU-IND issued notices to 15 overseas crypto platforms for not complying with the PMLA and sought removal of their apps and websites from public access in India.

What is the RBI's role in crypto?

The Reserve Bank of India (RBI) is the central bank, not the crypto regulator. In April 2018, it told the banks it oversees to stop dealing with crypto businesses, which cut exchanges off from the banking system.

On March 4, 2020, the Supreme Court quashed that circular in Internet and Mobile Association of India v. Reserve Bank of India. The court found the measure was not proportionate, partly because crypto itself had never been banned and the RBI had not shown harm to the banks it supervises. Since then, banks have not been barred by that circular from serving crypto firms, though AML checks still apply.

What could change next?

India still has no comprehensive crypto statute that licenses exchanges, sets investor protection rules or defines which tokens count as securities. For now, the practical rules come from FIU-IND guidance and tax law. To compare India's approach with other countries, see crypto regulation around the world and crypto anti-money laundering rules.

Rules differ by country and change often. Check the official regulator or a qualified professional for your own situation.