India’s Blockchain Landscape: Lessons from Global Crypto Leaders
India is at a crossroads in its blockchain and cryptocurrency journey. While the country has shown significant interest in blockchain technology—adopting it for government initiatives, banking, and logistics—crypto regulations remain a gray area. Countries like the USA, Singapore, and Switzerland have taken clear and progressive stances on crypto, enabling their industries to flourish. What can India learn from them, and how can the government improve its blockchain policies? Let’s dive in.
The Current State of Blockchain in India
Blockchain adoption in India has grown steadily. From financial institutions integrating distributed ledger technology (DLT) to state governments using blockchain for land records, there are promising developments. For example, Odisha launched the Shakti blockchain application to support survivors of gender-based violence, ensuring timely and transparent aid distribution. Similarly, India’s International Financial Services Centres Authority (IFSCA) is expected to release regulatory guidelines for blockchain and tokenization, which could provide much-needed clarity for the industry in 2025.
Despite these advancements, India still lags in terms of crypto adoption and regulatory clarity. The government has imposed a 30% tax on crypto profits, with an additional 1% tax deducted at source (TDS) on transactions, which has led to a decline in domestic trading volumes. While blockchain is being embraced, cryptocurrencies—arguably blockchain’s most important application—remain under tight scrutiny.
How Governments Worldwide Handle Crypto & Blockchain
1. How Governments Worldwide Handle Crypto & Blockchain
The USA has adopted a dual regulatory approach, where states and federal agencies oversee different aspects of crypto. Companies like Coinbase and Gemini operate under clear frameworks, while Bitcoin ETFs (exchange-traded funds) have gained approval, making crypto more accessible to traditional investors.
The U.S. Securities and Exchange Commission (SEC) does enforce strict compliance measures, but the overall environment supports institutional adoption, allowing banks and hedge funds to integrate crypto into their portfolios.
Lesson for India: Instead of restricting crypto trading through high taxes, India could regulate and legitimize the sector by introducing structured licensing frameworks for exchanges.
2. Singapore: A Crypto-Friendly Hub
Singapore is home to some of the world’s biggest crypto exchanges, including Crypto.com and Binance’s regional offices. The country’s Monetary Authority of Singapore (MAS) has developed a clear regulatory framework, providing licensing and compliance guidelines for crypto businesses.
Singapore’s balanced approach—allowing innovation while enforcing anti-money laundering (AML) and consumer protection laws—has made it a global leader in blockchain and fintech.
Lesson for India: Instead of outright bans or excessive taxation, India should create a regulatory sandbox where crypto startups can test their solutions under government supervision.
3. Switzerland: The Crypto Valley
Switzerland’s “Crypto Valley” in Zug has become a global hub for blockchain and crypto startups, including Ethereum, Solana, and Cardano. The Swiss government introduced crypto-friendly laws, allowing businesses to legally issue and trade digital assets.
Switzerland has also developed a tokenized financial ecosystem, integrating blockchain into banking services, making it one of the most crypto-progressive nations.
Lesson for India: India should explore tokenization opportunities in finance, allowing digitized real estate transactions, trade finance, and stock market settlements through blockchain.
What India Can Do to Improve Its Blockchain Landscape
1. Establish Regulatory Clarity
India needs a unified policy on crypto and blockchain. The IFSCA’s upcoming report may provide clarity on tokenization and smart contracts, but broader regulations must follow. A well-defined policy will attract global investments and prevent blockchain entrepreneurs from moving to Dubai or Singapore.
2. Reduce Crypto Tax Burden
The 30% tax on crypto gains and 1% TDS on transactions have led to plummeting trading volumes on Indian exchanges. To encourage domestic participation, the government should consider reducing TDS to 0.1% or introducing tax exemptions for long-term crypto investments, similar to equity markets.
3. Promote Blockchain in Governance & Banking
India has already started integrating blockchain in governance projects, but public-private partnerships can accelerate adoption. Tokenized deposits, digital rupees, and blockchain-based land records can bring transparency while boosting India’s financial sector.
4. Support Web3 Startups
Countries like the USA and Switzerland actively fund Web3 startups through grants and venture capital. India should create blockchain-specific startup accelerators and provide subsidies for blockchain R&D, ensuring that the next Polygon or CoinSwitch Kuber emerges from India.
Conclusion: The Future of Blockchain in India
India has the world’s largest developer base and a rapidly growing fintech industry. With the right policies, it could become a global leader in blockchain innovation. Instead of treating crypto as a threat, regulators should view it as an opportunity to strengthen India’s digital economy.
With upcoming policy updates in 2025, India has a chance to follow the best practices of global leaders like the USA, Singapore, and Switzerland while crafting its unique approach. Whether it’s regulatory clarity, reduced taxation, or blockchain-friendly banking services, the future is bright if India plays its cards right.
