The HC made the remarks while denying bail to businessman Umesh Verma in connection with a cryptocurrency-related fraud case
RBI’s top leadership has been vehemently critical of cryptocurrencies, with governor Sanjay Malhotra recently saying that cryptocurrencies could affect the country’s financial stability
Despite the unclear status of cryptos, the government charges a 30% tax on profits from sale of VDAs and an additional 1% levy on transactions exceeding INR 10,000 in a fiscal year
In a scathing indictment of cryptocurrencies, the Delhi High Court (HC) observed that dealing in such virtual digital assets can lead to the “dissolution” of recognised money into “dark, unknown and untraceable money”.
As per news agency PTI, the HC made the remarks while denying bail to businessman Umesh Verma in connection with a cryptocurrency-related fraud case.
“Dealing in cryptocurrency has profound implications on (the) economy of our country by way of dissolution of recognised money into the dark unknown and untraceable money. The allegations against the accused in this multi-victim scam are quite serious, more so in the light of his antecedents of involvement in as many as 13 more cases of similar nature,” the HC reportedly noted.
The case pertains to Verma allegedly luring gullible investors with false promises of 20% to 30% returns on cryptocurrencies. The HC observed that Verma, an accused in a case against Dubai-based cryptocurrency platform Pluto Exchange, continued to lure the public even after such VDA were “derecognised” in India.
Verma was initially arrested in December 2020 and was later released on interim bail. However, the HC ordered him to surrender before the investigating officer or the trial court.
India’s Uneasy Relationship With Cryptos
India has taken a strict regulatory stance on cryptocurrencies despite the growing adoption of the virtual digital assets in the country. While cryptocurrencies are not banned, they are not treated as legal tenders either.
While the government has not publicly stated its stance, the top leadership of the Reserve Bank of India (RBI) has been vehemently critical of cryptocurrencies. In 2022, the then RBI governor Shaktikanta Das termed cryptocurrencies a threat to macroeconomic and financial stability.
More recently, last month, current RBI governor Sanjay Malhotra said that cryptocurrencies could affect the country’s financial stability.
Despite the unclear status, the government charges a 30% tax on profits from sale of cryptocurrencies and an additional 1% levy on transactions exceeding INR 10,000 in a financial year. This has led to many crypto platforms shutting shop or moving their business outside India.
However, reports said earlier this year that the Centre would soon release a detailed discussion paper on the policy framework options for cryptocurrency assets. But there has been no update on the paper, which has been delayed three times now, after being earlier slated for release in September 2024 and June 2025.