India’s Parliamentary Standing Committee on Finance is studying Virtual Digital Assets, signaling a crucial step towards shaping digital asset policy. Despite concerns about systemic risks, this consultative approach aims to foster innovation while protecting investors and citizens in the evolving Web3 landscape.
When the Indian Parliamentary Standing Committee on Finance announced that its 2024-25 agenda would include “A Study on Virtual Digital Assets (VDAs) and Way Forward,” seasoned observers of financial regulation sensed a shift. This move, coupled with consultations involving officials from the Ministry of Finance and economic experts, signals a welcome shift in how India intends to engage with the world of digital assets. A Reuters article published on September 10, 2025, mentioned that as per a government document, India is resisting a full, comprehensive framework for crypto assets due to concerns about systemic financial risks. However, the Committee’s focused study and broad consultations represent an important and necessary first step in addressing these challenges and shaping India’s digital asset policy landscape.
Beyond rhetoric: Why regulating VDAs is an imperative, not a choice
Web3, crypto assets, and the broader sector have already arrived in India. With over 100 million crypto owners, more than anywhere else in the world and a vibrant home-grown Web3 developer community, India is staring squarely at an epoch-defining opportunity. And yet, the absence of clear, agile regulation has left a vacuum: innovations migrate offshore, genuine investors face uncertainty, and retail users are often exposed to “Wild West” conditions.
Consultation: The bedrock of effective, democratic regulation
What makes the current Parliamentary process different is its deliberate consultative stance. Consultations are not just a procedural tick-box; they are the bedrock of smart, legitimate regulation in fast-moving, complex sectors like digital assets.
While the Standing Committee’s initial depositions are a good starting point, there’s much more that can be done to ensure India’s VDA policy is both world-class and purpose-fit. To foster the most representative and effective regulatory process, it is important that consultations are broadened thoughtfully. While Delhi-based industry associations and stakeholders have always played a pivotal role, it would be valuable to actively engage participants from across regions and sectors. Utilising digital platforms for feedback and organising regional consultations can ensure diverse perspectives, including those of innovators from Tier-2 cities and individual users, are incorporated alongside major industry voices.
Additionally, providing periodic educational sessions and masterclasses, led by technical and regulatory experts for parliamentary staff and members, will strengthen the Committee’s ability to fully understand and respond to the complexities of the VDA sector.
Encouraging seamless dialogue among all relevant regulatory bodies, such as the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), tax authorities, and cybersecurity agencies, will help build a more holistic approach. Digital assets present challenges and opportunities that transcend traditional boundaries, making integrated policymaking essential.
India’s regulatory choices now will ripple far beyond its shores. As one of the world’s largest digital economies, its approach to crypto assets will establish a template for the global south. Done right with deep consultation, openness, and adaptive frameworks, India can both protect its citizens and empower a new generation of entrepreneurs.
The Indian Parliamentary Committee’s focus on VDAs is both historic and pragmatic, a signal of a government ready to embrace technological change not with trepidation, but with a steady, collective hand. As the Committee prepares to hear not just from the Ministry of Finance but from a chorus of stakeholders across the nation, India has the chance to create the world’s most dynamic, inclusive, and forward-looking digital asset regulatory model.
Harnessing this moment requires not only technical skill, but political wisdom and above all, a respect for the power of consultation and democratic dialogue in shaping the digital futures of 1.4 billion citizens.
*This article is contributed by Sumit Gupta, Co-Founder, CoinDCX.
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The above content is non-editorial, and TIL hereby disclaims any and all warranties, expressed or implied, relating to the same. TIL does not guarantee, vouch for or necessarily endorse any of the above content, nor is it responsible for them in any manner whatsoever. The article does not constitute investment advice. Please take all steps necessary to ascertain that any information and content provided is correct, updated and verified.
(You can now subscribe to our Economic Times WhatsApp channel)
