India is taking a firmer stance on digital assets while pushing forward with its own central bank digital currency, the digital rupee. During a recent India-Qatar economic meeting, Commerce Minister Piyush Goyal said that the government will continue taxing and regulating cryptocurrencies, but plans to make the Reserve Bank of India’s (RBI) digital rupee more accessible to the public.
Goyal made it clear that India does not support private cryptocurrencies that have no government or asset backing, calling them risky and speculative. Instead, the focus is on expanding the RBI’s digital rupee, a state-backed alternative that works much like a stablecoin but is fully supported by India’s sovereign reserves.
The digital rupee was first launched in 2022 and currently exists in two forms. One version is used for interbank settlements, while the other is meant for everyday use by individuals and businesses. By early 2025, more than five million people had already used it. Now, the government wants to let non-bank platforms offer e-rupee wallets to make it easier for more people to use.
This move is expected to make payments faster, more transparent, and less dependent on cash. It will also help reduce paper use from currency printing and improve security by making transactions traceable, an important step in preventing fraud and cybercrime.
While India promotes its own digital currency, it has kept strict taxes on private crypto assets. All profits from digital currencies are taxed at 30%, and every transaction above ₹10,000 faces a 1% tax deducted at source (TDS). This heavy tax structure focuses on control and compliance rather than encouraging growth or innovation.
A survey by Mudrex found that while most Indians, around 93%, support crypto regulation for investor safety, only a small number, about 13%, agree with the high tax rates. For most investors, the taxes remain the biggest barrier to entering the crypto market. Still, India ranks number one in the Global Adoption Index 2025, thanks to strong retail participation, fintech innovation, and active blockchain developers.
The RBI’s digital rupee project has already achieved key milestones. By March 2025, its total circulation reached ₹1,016 crore, and trials for cross-border use were announced. Recently, fintech company Cred became the first non-bank to join the pilot, offering e-rupee wallets through YES Bank. This marks another step in India’s plan to blend blockchain technology with traditional finance under full government oversight.
India’s approach shows a clear pattern, it wants the benefits of digital innovation but under strict supervision. By introducing the digital rupee while maintaining strict regulations on private tokens, the government aims to ensure transparency, protect the economy, and maintain control over money flows.
If the rollout continues smoothly, India could become one of the few major economies to successfully balance innovation with regulation, building a digital financial system that combines blockchain efficiency with government-backed stability.
