The implications go beyond lost tax revenue. As Pankaj Balani, CEO and Co-Founder of Delta Exchange, observed,
“When platforms sit beyond Indian jurisdiction, oversight weakens, consumer grievance redressal becomes limited, and the economic value created by Indian users disproportionately flows overseas.”
As a consequence, the country will also lose out on jobs and the subsequent economic value. One must also note that these can be tough waters to wade through, especially in times of geopolitical stress.
Strong digital payment infrastructure, but crypto stays out?
India has built some of the world’s strongest financial rails and has been labelled a global success for the same. But when it comes to digital assets, the confidence seems to stop short.
It’s no secret that crypto challenges comfort with decentralized ownership.
India’s approach so far has been compliance-first, with strict reporting and monitoring. The system heavily controls participation, but hesitates to expand on why the asset should exist at all.
As Nischal Shetty, Founder of WazirX, noted,
“The current framework needs to be reconsidered in lines of how Web3 has matured over the last couple of years globally, both in adoption and institutional participation driven by an evolving regulatory environment.”
The issue, then, is clearly mindset. India has proven it can build digital infrastructure at scale. But is the country prepared to extend that confidence to citizen-owned digital assets?
Show me the intent!
By now, it is difficult to argue that India lacks regulation around crypto. Exchanges operate under strict compliance and reporting obligations.
What remains unclear is the direction they are meant to serve.
Without an articulated policy intent, regulation may go defensive, instead of the developmental approach required for an industry like this. Markets struggle in environments where long-term objectives are left unstated.
Case in point? Just last month, Coinbase reopened user registrations in India and announced plans to launch a fiat on-ramp in 2026. The exchange had previously entered India in 2022, suspended operations due to UPI-related payment restrictions, and fully exited the market in 2023.
The return means global crypto players still see long-term opportunity in India.
Source: X
Raj Karkara, COO of ZebPay, agrees. He added,
“A clear and consistent framework for digital assets would help strengthen trust among investors, institutions, and market participants, while enabling business to operate responsibly within well-defined boundaries.”
The confidence he’s talking about is predictability.
Until policy helps us understand where crypto fits within India’s economic vision, participation will be in a less than ideal tone. That could go south quickly, with global markets moving ahead.
Budget 2026: Expectations?
Notably modest.
Key stakeholders and the Indian crypto community want clear intent. The consensus is clear: They want rules on permissible activity, a more coherent framework, and a tax structure that does not actively push activity offshore. These will be considered markers of seriousness.
As Shetty told AMBCrypto,
“With the right policy the crypto industry could help India achieve a 5 trillion dollar economy target.”
Even incremental steps (such as outlining the contours of a Crypto Bill or indicating a willingness to revisit transaction-level frictions) would indicate the policy’s willingness to catch up with reality.
Source: X
Approach to digital money is also beginning to extend beyond the central bank.
Alongside ongoing digital rupee pilots, policymakers are preparing for ARC, a regulated, rupee-backed stablecoin issued by the private sector. It will run on blockchain rails while keeping settlement anchored to the Reserve Bank of India.
For a country projected to become the 3rd largest economy soon, these developments are critical.
Source: IMF
So here’s the thing…
Small economies can afford to wait and watch. Large economies cannot.
Crypto will evolve with or without India. The country’s indecision itself has become a position that global markets factor in. With the budget coming up, it’s up to the country to decide if it wants to join in to lead, or adapt later to rules written elsewhere.
Final Thoughts
- With 100 million users and $5 trillion in offshore crypto volume, India is already a crypto economy.
- India’s hesitation to establish a better framework risks a missed advantage.