Supreme Court Criticizes India's Crypto Tax Without Regulation

The Supreme Court of India has criticized the government for its inconsistent approach to cryptocurrency regulation, highlighting the disparity between taxing crypto transactions at a high rate and the lack of clear regulatory guidelines. The court, while hearing a bail plea in a multi-state crypto fraud case, likened unregulated Bitcoin trading to a "hawala business," emphasizing the potential for misuse and economic impact.

Justice Suryakant remarked, “If you can tax it at 30%, also please regulate it as you have recognised it by taxing it.” This statement underscores the court's concern over the government's delay in establishing a comprehensive regulatory framework for digital currencies. The court urged the central authorities to expedite the creation of regulations to monitor and control digital currencies effectively.

The court's remarks come amid ongoing investigations into illegal Bitcoin trading activities, such as the case involving Shailesh Babulal Bhatt, who is accused of extorting significant amounts of cryptocurrencies and cash. The Supreme Court also dismissed a ₹2,000Cr. case involving the WazirX hack, citing the lack of clear crypto regulations in India. Victims were advised to approach institutions like the RBI, SEBI, or CBI, which have historically avoided crypto accountability.

In response to the regulatory uncertainty, India’s ultra-rich are shifting their investments from cryptocurrencies to luxury real estate. According to luxury real estate advisor Aishwaraya Shri Kapoor, the country’s top 0.001% are building portfolios worth ₹75–500 crore, focusing on land and branded real estate. These high-net-worth individuals are acquiring high-value land parcels, branded residences, pre-leased commercial floors, trophy penthouses, and heritage properties across major cities in India and abroad.

The motivation behind these investments is not just returns but also capital protection, liquidity safety, and access to exclusive resale circles. The lack of regulation, safety, and capital protection in the crypto market has driven these investors to seek more stable and secure investment options.