The Indian tax authorities recently reiterated the old topic—cryptocurrency transactions causing trouble—before the parliamentary Finance Standing Committee. In simple terms, they feel this area is really hard to regulate.

Where's the problem? The combination of offshore exchanges, private wallets, and decentralized financial tools directly makes it impossible for them to track taxable income. Plus, with multiple jurisdictions involved, enforcement becomes even more difficult. Imagine money moving on the chain, flowing through exchanges in different countries—how can tax authorities keep up?

The current policy is set as follows: profits from crypto assets are uniformly taxed at 30%, and all transfers are also subject to a 1% tax. It sounds strict, but in practice, enforcement becomes another story—detection capabilities lag behind, and law enforcement falls short. The government’s attitude towards cryptocurrencies remains cautious—they want to collect taxes but are also wary, and they haven't figured out what to do in the short term.