A RESEARCH STUDY ON THE LEGAL IMPLICATION OF CRYPTO CURRENCY IN INDIA

ABSTRACT
Cryptocurrency has surfaced as one of the most disruptive, financial and technological
innovations of the twenty-first century. It stands as a challenge to the traditional, legal,
regulatory, and monetary standards of the Indian economy. India’s response towards crypto
market has been very complex. It has evolved from early cautionary advisories to de facto
prohibitions, and subsequently towards an ambiguous acceptance through heavy taxation and
anti–money laundering regulations. India has understood that ignoring crypto won’t make
things any better, and instead of resisting, it has to slowly start taking measures.
The analysis begins by taking into account, the constitutional framework, throwing light on
Article 19(1)(g) and also reviewing the Supreme Court’s landmark judgment in its Internet
Mobile Association of India vs Reserve Bank of India (2020) case. The court slashed down the
RBI’s 2018 outright ban as unreasonable, while emphasising the authenticity of a balanced and
finely tuned regulation. It further proceeds by examining how the existing legislations,
including the Income Tax Act, the Prevention of Money Laundering Act, Foreign Exchange
Management Act, and the IPC, have adjusted to rectify cryptocurrency related fraudulent
activities such as trading, terror funding, fraud, money laundering, hacking, and cross-border
transfers.
By studying various case laws, enforcement actions, and institutional practices, the research
also demonstrates as to how some Indian authorities might increasingly treat cryptocurrency as
a property, in the absence of a uniform legal definition. At the same time, it also highlights the
significant gaps like definitional ambiguity, a jurisdictional overlap among and between the
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Volume 3 Issue 6 | April 2026 ISSN: 2581-8503
Page | 896
regulators, inadequate protection to the common man, data-protection issues and uncertainty
and civil liability.