India Uncovers $124 Million in Hidden Foreign Crypto Income

• The Finance Ministry, via the Central Board of Direct Taxes (CBDT), revealed that 5,483 taxpayers filed belated income tax returns (ITR) for the 2024-25 assessment year
• Several days ago, ₹630 crore (about $72 million) in hidden crypto income was uncovered via tax audits and search operations across India
• The Income Tax Department also recently seized digital assets worth ₹2.7 crore (around $327,000) from individuals with undeclared crypto holdings

India’s Ministry of Finance has reported uncovering a staggering ₹29,208 crore (approximately $3.33 billion) in hidden foreign assets for 2024-25, along with ₹1,089 crore (roughly $124 million) from undisclosed foreign crypto income.

Via the Central Board of Direct Taxes (CBDT), the authority revealed that 5,483 taxpayers filed belated income tax returns (ITR) for the 2024-25 assessment year. These filings are the reason why the organization found out about the mentioned unreported foreign assets.

The disclosures come from a data-driven “nudge campaign,” where the CBDT matched ITR submissions based on data obtained from foreign jurisdictions. Taxpayers who had not disclosed all of their income received automated prompts via SMS and email to amend their tax returns.

How they did it. This isn’t a random audit. It’s part of a massive campaign. Here’s our original report on the 44,000 notices India sent to crypto traders.

Interestingly, this isn’t the first time a similar scenario has happened. For instance, just several days ago, ₹630 crore (about $72 million) in hidden crypto income was uncovered via tax audits and search operations across India.

The Income Tax Department also recently seized digital assets worth ₹2.7 crore (around $327,000) from individuals with undeclared crypto holdings. Several days ago, ₹705 crore (roughly $80 million) in crypto-related taxes were collected from voluntary disclosures across the last two fiscal years.

Crypto in India is on a big rise

India continues to top the global crypto adoption charts, with over 119 million crypto users, which is about one-fifth of all worldwide holders.

According to recent rankings, the country leads in grassroots crypto adoption with a perfect score of 1.00, indicating widespread retail and peer-to-peer engagement.

Why the focus on crypto? India has one of the biggest crypto markets in the world. Here’s our deep dive separating the facts from the hype on local adoption.

As of this year, crypto assets in India remain legal to hold and trade, although they’re not recognized as legal tender. Users must operate through FIU (Financial Intelligence Unit ) registered platforms and fully comply with tax rules, including the 30% capital gains tax and 1% TDS (tax deducted at source).

Due to high taxes, the crypto industry is pushing to lower them with the goal of preventing capital from moving to foreign markets and to stimulate more domestic crypto trading.

The country is currently developing a new crypto policy paper for 2025. The aim is to find a balance between promoting innovation and ensuring regulation, and the tax reforms are expected to be a part of the new crypto policy.