The Madras High Court.
Credit: PTI File photo
Bengaluru: Crypto exchanges on Monday opined that the Madras High Court ruling that cryptocurrency qualifies as 'property' under Indian law is a major step towards investor protection and that this is a win for investor safety.
While hearing a plea filed by an investor whose coins were frozen after the WazirX cyberattack, the Madras High Court stated that crypto investments do not fall under the category of 'speculative transactions'.
A cyberattack on WazirX in July last year led to the theft of about Rs 2,000 crore worth of funds.
Vikram Subburaj, CEO, Giottus Crypto Exchange, said this recognition of crypto as ‘property’ does not merely settle a legal question. It anchors the massive virtual digital assets (VDA) economy to India’s constitutional fabric of rights and remedies.
"The court has extended property and trust principles to VDAs. Thereby, it confers on VDAs the same sanctity that underpins physical ownership. At a deeper level, the order effectively transforms blockchain from being a frontier of code into a framework of enforceable rights. This is, in effect, a codification of confidence. It is a moment when jurisprudence catches up with innovation."
He added that alongside the Bombay High Court’s recent stance on custodial duty (of crypto exchanges), this judgment defines the country's emerging doctrine of digital-asset accountability.
Exchanges also pointed out that for investors, it signals protection and that it provides an important step towards greater clarity in how digital assets are viewed under Indian law.
"It suggests a maturing perspective on this evolving asset class and indicates that cryptocurrencies are beginning to be seen as having legitimate economic relevance within existing legal and financial frameworks. While it does not change the current regulatory landscape, the ruling could help create a more informed environment for investors and market participants. It also reflects an intent to gradually bring structure and transparency to the digital asset space in a manner that balances innovation with investor protection," said Avinash Shekhar, Co-Founder & CEO, Pi42.
Edul Patel, CEO of Mudrex, said this ruling gives Indian courts jurisdiction even when exchanges operate abroad, ensuring accountability.
"However, treating all crypto tokens as property could create problems since different tokens serve different purposes. For example, governance tokens like UNI from Uniswap are used to vote on decisions within a decentralised protocol, not for profit. If such tokens were taxed or regulated as property, every on-chain vote could be seen as a taxable transaction, which would be impractical, as no money is actually being made," he said.
Patel added that the country now needs balanced regulations that protect users while leaving room for innovation, recognising crypto as a technology shaping the future of finance.