Parliament's Standing Committee on Finance, chaired by a senior MP, is scheduled to review the regulatory framework for Virtual Digital Assets (VDAs) on July 2, 2025. The Reserve Bank of India and the Institute of Chartered Accountants of India will present their perspectives. India currently taxes VDAs at 30% on gains plus 1% TDS under Section 194S of the Income Tax Act, introduced in the Union Budget 2022-23. No comprehensive crypto regulation law exists yet.

India's approach to Virtual Digital Assets has been deliberately cautious — tax first, regulate later. The 30% flat tax on VDA gains and 1% TDS introduced in Budget 2022-23 effectively signaled that the government treats crypto as a speculative asset class, not legal tender. The RBI has historically opposed cryptocurrencies, citing risks to monetary sovereignty, financial stability, and capital flow management. It has instead pushed its own Central Bank Digital Currency, the Digital Rupee (e-₹), piloted in both retail and wholesale segments.

The Parliamentary Standing Committee's July 2025 review is significant because it brings together fiscal regulators (ICAI on accounting and disclosure standards) and monetary regulators (RBI on systemic risk) to inform potential legislation. India is also bound by the Financial Action Task Force's Travel Rule, requiring VDA service providers to collect sender-receiver information — a compliance burden that only a clear regulatory framework can operationalize.

Globally, the EU's MiCA (Markets in Crypto-Assets) regulation became fully operative in 2024, creating pressure on India to establish comparable clarity for cross-border VDA transactions. Without regulation, Indian exchanges face jurisdictional arbitrage risks, while investors lack consumer protection. The committee's deliberations could shape a dedicated VDA regulatory bill, balancing innovation with financial stability — a classic policy trilemma in the digital finance era.