Cuttack: Orissa high court has sought clarity on the legal status of cryptocurrency in India while hearing four petitions challenging the freezing of bank accounts in connection with alleged crypto transactions.A bench of Justice S K Panigrahi was dealing with separate pleas filed by four persons in May 2025 after the SDJM court in Balangir rejected their applications for de-freezing of accounts seized following FIRs lodged at the cybercrime and economic offence police station in Balangir.During the hearing on Monday, the state counsel submitted that he was “presently not in a position to render effective assistance to this court on the specific and substantial question that arises for consideration in the present case, namely, whether cryptocurrency, in the context of the allegations forming the subject matter of this proceeding, is to be treated as legal, illegal, regulated, or otherwise within the prevailing statutory and regulatory framework in India”.Stating that the matter involves both legal and technical dimensions, Justice Panigrahi directed the Balangir SP to appear in person on Feb 26. The nodal officer of the cyber cell, Balangir, or any other responsible officer conversant with cryptocurrency platforms, blockchain technology, digital wallets and the regulatory regime governing virtual digital assets, has also been asked to assist the court.The officers have been directed to apprise the court on the present legal status of cryptocurrency, any statutory prohibition on its possession or trade, the existing regulatory framework, the manner in which such offences are investigated and prosecuted, and the basis or intelligence inputs for lodging the FIRs.Govt was directed to deposit Rs 25,000 as costs for repeated adjournments with the Odisha State Legal Services Authority before the next date of hearing.Justice Panigrahi observed that the issue was “not merely academic but has significant implications in matters relating to cyber offences, financial fraud, money laundering, and cross-border transactions”.He further said the “absence of a comprehensive and codified legislative framework specifically declaring cryptocurrency as either per se legal tender or per se prohibited instrumentality”, highlighting the need for a nuanced understanding of the prevailing legal and regulatory position, including the role of Reserve Bank of India and other oversight bodies.
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