Bitcoin News Today: India's COINS Act 2025 Eliminates 30% Crypto Tax Boosting Market Participation

The COINS Act 2025, India's pioneering model crypto law, is poised to transform the nation's approach to digital assets. This legislation aims to eliminate the 30% tax on crypto transactions, introduce self-custody rights for digital assets, include Bitcoin in national reserves, and establish the Crypto Asset Regulatory Authority (CARA). These measures are designed to address long-standing issues of regulatory ambiguity and investor vulnerability that have plagued the Indian crypto ecosystem.

The Indian crypto landscape has been plagued by repeated breaches and a lack of statutory frameworks. In July 2024, WazirX, then India’s largest crypto exchange, suffered a significant cyberattack resulting in the loss of assets worth ₹2,000 crore. Despite investigations suggesting links to North Korea-affiliated entities, no formal regulatory penalties or investor compensation followed. Similarly, in July 2025, CoinDCX disclosed a server-side vulnerability that led to a loss of $44 million. These incidents highlight the absence of any statutory framework, unregulated communication, and lack of structured disclosures in the crypto world.

The regulatory stance of Indian authorities has been appropriately measured. Former RBI Governor Shaktikanta Das had reiterated concerns about the destabilizing potential of cryptocurrencies. The RBI maintains that private crypto assets pose risks to financial stability and monetary policy transmission. The Indian central bank’s preferred digital alternative remains the e-rupee, India’s Central Bank Digital Currency (CBDC), which was first introduced in November 2022. The e-rupee, backed by a sovereign guarantee and issued by the RBI, represents a deliberate, regulated approach in the face of the challenge posed by non-fiat virtual currencies such as Bitcoin.

India’s official engagement with crypto has been limited to tax treatment. Virtual digital assets are subject to a 30% flat tax on income from transfer and a 1% TDS on transactions above a specified threshold. These provisions generate revenue but do not offer investor protection nor do they legitimize the asset class. Registration with the Financial Intelligence Unit (FIU) has been mandated for virtual digital asset service providers, but in the absence of a dedicated crypto regulation law, enforcement remains limited in scope.

The COINS Act 2025 seeks to address these issues by introducing a comprehensive regulatory framework. The elimination of the 30% tax is expected to boost investor confidence and encourage more participation in the crypto market. Allowing self-custody of digital assets will give users more control over their investments, reducing the risk of losses due to platform vulnerabilities. Including Bitcoin in national reserves will provide a stable foundation for the digital asset market, while the introduction of CARA will ensure formal oversight and protection for investors.

The passage of the GENIUS Act in the United States, which formalizes the role of dollar-backed stablecoins as regulated instruments, has drawn attention globally. However, for Indian crypto investors, the significance of this development remains largely external. The contrast between the US’s codified protections around certain digital assets and India’s lack of institutionalization of crypto is stark. While the US has taken steps to reinforce its monetary influence through digital proxies, India has refrained from institutionalizing crypto due to legitimate concerns over stability, misuse, and limited economic value.

The COINS Act 2025 represents a significant step forward in India’s approach to digital assets. By addressing the long-standing issues of regulatory ambiguity and investor vulnerability, the legislation aims to create a more stable and secure crypto ecosystem. The introduction of CARA will provide formal oversight and protection for investors, while the elimination of the 30% tax and allowance of self-custody will boost investor confidence and encourage more participation in the market. The inclusion of Bitcoin in national reserves will provide a stable foundation for the digital asset market, ensuring that India remains at the forefront of the global crypto revolution.