Cryptocurrency is legal in India as of January 2026 but comes with the world's harshest tax regime - a flat 30% tax on profits, 1% TDS on every transaction, and zero deductions for losses. For India's estimated 150+ million crypto users, this creates a paradox of legal participation with financial penalties so severe they discourage active trading. The RBI remains deeply skeptical of private cryptocurrencies, viewing them as threats to monetary sovereignty, while continuing to issue warnings about volatility and fraud risks despite the Supreme Court overturning the banking ban.