Is Bitcoin legal in India ?

Bitcoin is a decentralised crypto currency which is limited in supply. It is operated through a decentralized system called block chain , through  computers, which operates as node in peer to peer bitcoin network.The block chain is a public distributed ledger which contains rcords/blocks of each transaction. Each block is secured by cryptographic hash of previous blocks hence creating a chain of records.

Legality of Bitcoin in Countries

USA

Recently in 2025 Trump, President of USA  has  shown strong support and inclination towards crypto currency .
Donald Trump after getting re-elected to  president’s office has signed an executive order policy promoting crypto.
The executive order titled “Strengthening American leadership in Digital Financial Technology” was issued on 23rd January 2025 by Trumps administration.
The purpose of policy outlined therein states that “the digital asset industry plays a crucial role in innovation and economic development in the United States, as well as our Nation’s international leadership.  It is therefore the policy of my Administration to support the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy”
This policy advocates for protecting individual access to open public blockchains, promoting US dollar sovereignty through stablecoins, providing regulatory clarity for digital assets and blockchain technologies, and preventing the use of CBDCs within the US due to risks to financial stability, privacy, and national sovereignty.
It also provides for establishment of president’s working  Group on Digital Asset market.
USA is one of the biggest economies and under Trumps administration it has set forth clear stance on being Pro-crypto.

Indian Government

Indian government led by PM Modi has not made clear its stance on crypto currency yet , it seems to be in a quagmire of confusion when it comes to policy on crypto currency.
The Modi government has neither declared crypto illegal nor accepted it as legal tender though any person trading in crypto currency shall be taxed on capital gain–30%, and 1% TDS thus recognising it as digital financial assets which can yield income.
In 2018 RBI issued a circular prohibiting dealing in virtual currency.
The Supreme Court overturned the Reserve Bank of India’s ban in 2020, allowing the trade and use of cryptocurrencies. However, the Indian financial regulators, including the Reserve Bank of India (RBI), maintain a cautious stance on cryptocurrencies due to their volatile nature and the potential for misuse in illicit activities. The RBI emphasizes that only central bank-issued digital currencies, such as its own proposed Central Bank Digital Currency (CBDC), can be considered legal tender.
With Donald Trumps administration  advocating pro-crypto policy, the government in India is reportedly also reconsidering its stance on cryptocurrency usage and acceptance.
“More than one or two jurisdictions have changed their stance towards cryptocurrency in terms of the usage, their acceptance, where do they see the importance of crypto assets. In that stride, we are having a look at the discussion paper once again,” India’s Economic Affairs Secretary Ajay Seth said in an interview.

Risk

In India there is no regulatory authority for regulating cryptocurrencies. SEBI is the regulatory authority for Stock markets in Inda.

But crypto assets are not under the purview of SEBI and any offence in relation to illicit activities like insider trading, pumping and dumping , money laundering etc. becomes a challenge for Indian government to tackle with to protect individual  investors.

India needs a comprehensive policy regulating crypto currency . India cannot overlook crypto currency as it can have major impact on economy of the world as institutional banks from across the globe are investing and countries like El Salvador are buying bitcoins thereby increasing their bitcoin reserve. USA in prospect to make crypto a fully legal asset for investors and makjng policies to protect and promote digital assets.