TLDR
India now has a detailed academic-legal report laying out five concrete models for how the country could regulate crypto.
- Gujarat National Law Universitys report proposes five regulatory models, from SEBI or RBI control to a new dedicated crypto regulator and interim self-regulation.
- The report argues current tax and AML rules are not enough for nearly 120 million Indian crypto users, leaving exchanges and investors in legal uncertainty.
- The next signal to watch is whether the central government or regulators adopt one of these models as the basis for a formal bill or consultation.
Deep Dive
1. What The New Report Proposes
Gujarat National Law University, working with the Society of Indian Law Firms, released a report titled Crypto-Assets in India: Assessing the Case for Regulation in New Delhi with senior judges in attendance.
The study notes India has crypto taxation and anti money laundering coverage, but no dedicated crypto statute, and estimates that nearly 12 crore Indians use crypto, which raises pressure for a clear framework.
It outlines five regulatory paths:
- SEBI led regulation treating many crypto assets like securities.
- RBI led oversight focused on money, payments, and financial stability.
- A coordinated multi regulator model.
- A brand new specialist crypto regulator.
- A period of self regulation by industry under government supervision, to be formalized later.
Policymakers now have a menu of options drawn from global practice rather than starting from scratch.
2. Why It Matters For Users And Exchanges
The report stresses that, despite taxes and AML obligations, exchanges, investors, and service providers still lack clarity on licensing, product categories, and which regulator they answer to.
For users, this uncertainty shows up as sudden banking restrictions, uneven KYC practices, and the risk that a product deemed acceptable today could be challenged later. For exchanges, it affects whether they can safely offer derivatives, yield products, or stablecoin services in India.
If SEBI or RBI centric models win out, expect stricter disclosure, segregation of client funds, and capital requirements, similar to securities brokers or payment institutions.
A clearer regime could reduce rug pull and fraud risk, but may limit high yield or lightly regulated products that many retail users currently see.
3. What To Watch Next In India
The report itself is not law. The key question is whether the Finance Ministry, RBI, SEBI, or a parliamentary committee picks up one of these models for formal consultation or drafting.
Watch for: inclusion of crypto in future budget speeches, white papers or discussion notes from RBI or SEBI, and any move to define which tokens are treated as securities versus pure commodities or utility tokens.
Global coordination also matters. India has already aligned some rules with international AML standards, and could borrow elements from frameworks like the EUs MiCA or function based approaches like Australias while keeping strict tax treatment.
For anyone active in India, the main edge is staying alert to early government signals, since they will shape which business models remain viable onshore versus being pushed offshore.
Conclusion
India is shifting from ad hoc tax and AML measures toward a structured debate about full spectrum crypto regulation. The Gujarat National Law University report does not decide the outcome, but it frames the menu of choices for regulators. How Delhi balances investor protection, capital controls, and innovation in choosing among SEBI, RBI, multi regulator, or new regulator models will determine how attractive India remains as a crypto market and development hub.
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