The Parliamentary Standing Committee on Finance, chaired by BJP MP Bhartruhari Mahtab, has scheduled a discussion with representatives of three major cryptocurrency exchanges, ZebPay, Binance, and WazirX, on May 20, 2026, on the subject: “A Study on Virtual Digital Assets (VDAs) and Way Forward.”
The Standing Committee on Finance is continuing its ongoing study on Virtual Digital Assets (VDAs) and the way forward. The committee has previously engaged with crypto industry stakeholders, including associations and representatives. A notice dated May 13, 2026, issued by the Lok Sabha Secretariat, is reported to outline the schedule for further participation by leading crypto trading platforms.
Three back-to-back sessions planned
According to the notice signed by Director Bharti Sanjeev Tuteja from the Standing Committee on Finance Branch, the committee has planned a full day of sittings at Parliament House Annexe in New Delhi with three separate sessions.
The first session, scheduled from 11:00 AM to 12:30 PM, will feature a direct discussion with representatives of ZebPay, Binance, and WazirX in Committee Room ‘D’ at Parliament House Annexe. This session is expected to focus on the operational realities, compliance practices, and policy perspectives of the three exchanges.
The second sitting, from 12:30 PM to 1:30 PM, will involve oral evidence from the International Financial Services Centre Authority (IFSCA). IFSCA, the unified regulator for the GIFT City International Financial Services Centre in Gujarat, has been closely involved in shaping policy around digital assets.
Notably, IFSCA issued a revised Global Access Circular in August 2025 that excluded crypto assets and any product with cryptocurrency as its underlying from the definition of permissible “financial products” in the IFSC, effectively barring Global Access Providers from offering such products to Indian residents.
The third session, beginning at 2:00 PM after a lunch break, will hear oral evidence from representatives of the Ministry of Finance (Department of Revenue) and the Ministry of Corporate Affairs. This session is likely to cover the government’s broader policy position on VDA taxation, compliance enforcement, and the potential for a dedicated regulatory framework.
Why ZebPay, Binance, and WazirX
The selection of these three platforms is significant.
ZebPay, founded in 2014 and headquartered in Ahmedabad, is one of India’s oldest crypto exchanges with over 6 million registered users. The platform is registered with the Financial Intelligence Unit-India (FIU-IND) under the Prevention of Money Laundering Act and has positioned itself as a compliance-first player in the Indian market.
Binance, the world’s largest cryptocurrency exchange by trading volume, has had a turbulent journey in India. The platform was among nine offshore exchanges that received show-cause notices from FIU-IND in December 2023 for operating without registration under Indian anti-money laundering laws. India blocked access to these exchanges in January 2024. Binance subsequently registered with FIU-IND in August 2024 after paying a penalty of Rs 18.82 crore and resumed operations. In April 2025, the exchange mandated re-verification of KYC for all Indian users, including PAN card submission and live selfie checks.
More recently, in April 2026, Binance India was named Digital Assets Exchange of the Year and Best Crypto Investment Platform at the Entrepreneur India IDEA Awards 2026 in Bengaluru, a remarkable turnaround from its earlier regulatory troubles.
WazirX, once India’s largest domestic crypto exchange, has been at the centre of one of the biggest security crises in Indian crypto history. On July 18, 2024, the platform suffered a devastating hack in which approximately $234.9 million (around Rs 2,000 crore) worth of digital assets were stolen from a multi-signature wallet.
Global analysis later linked the attack to North Korea’s Lazarus Group. WazirX halted all trading and withdrawals, froze user funds, and entered a restructuring process through the Singapore High Court, which sanctioned a creditor-approved scheme in October 2025.
The platform restarted operations on October 24, 2025, returning approximately 85% of funds to users. The exchange’s founder, Nischal Shetty, and its operational challenges have remained a focal point of the debate around consumer protection in India’s crypto sector.
A continuation of the panel’s deep dive
The May 20 sittings are part of a broader effort by the Standing Committee on Finance to understand the VDA landscape in India. The committee selected “A Study on Virtual Digital Assets (VDAs) and Way Forward” as a subject for detailed examination during the 2024-25 period, listed as Item No. 3141 in the Lok Sabha Bulletin Part II published on August 14, 2025, as per the Tribune report.
The decision to take up the study came after a delegation of Web3 and digital asset stakeholders, including the Digital South Trust, Bharat Web3 Association, Hashtag Web3, BlockOn Ventures, KoinBX, and CoinDCX, submitted policy recommendations to the committee chairperson in late July 2025. The group called for innovation-friendly regulation to unlock a $100 billion Web3-driven economy by 2035.
On January 7, 2026, the committee held a nearly three-hour sitting with representatives of the Financial Intelligence Unit-India (FIU-IND) and the Central Board of Direct Taxes (CBDT), both under the Ministry of Finance’s Department of Revenue. During that session, CBDT officials informed the panel that approximately Rs 888.82 crore in undisclosed income related to VDA transactions had been identified, and tax authorities had issued notices to more than 44,000 taxpayers suspected of non-compliance. FIU-IND, for its part, highlighted that 49 crypto exchanges had registered as reporting entities under the PMLA as of that date.
The broader regulatory context
India’s approach to cryptocurrency regulation has evolved significantly in recent years, though a comprehensive legal framework for VDAs remains absent.
The Finance Act, 2022, classified cryptocurrencies as Virtual Digital Assets under Section 2(47A) of the Income Tax Act. Under Section 115BBH, all income from the transfer of VDAs is taxed at a flat 30%, with no deductions permitted other than the cost of acquisition.
Losses from one VDA cannot be set off against gains from another, or against any other head of income. A 1% Tax Deducted at Source (TDS) applies on VDA transactions above the prescribed thresholds under Section 194S.
In March 2023, virtual digital asset service providers were brought under the Prevention of Money Laundering Act, making them reporting entities under FIU-IND. This was expanded through FIU-IND’s updated AML and CFT guidelines issued on January 8, 2026, which brought crypto exchanges, custodians, wallet providers and NFT platforms under the same compliance standards as banks.
The Finance Bill 2025 further proposed to expand the VDA definition from April 1, 2026, to include any crypto asset relying on cryptographically secured distributed ledger technology.
Meanwhile, the CBDT opened consultations with industry stakeholders in August 2025, asking whether India needs a dedicated VDA law and which regulator, whether SEBI, RBI, MeitY, or FIU-IND, should oversee the sector. On December 16, 2024, the Ministry of Finance had told Parliament that there was “no timeline anticipated for introduction of comprehensive regulatory guidelines for VDA industry in India.”
Industry stakeholders have consistently argued that the stringent tax regime has pushed trading volumes offshore. According to estimates, approximately 90% of VDA trading volume involving Indian users occurs on offshore platforms outside India’s regulatory jurisdiction. India has topped the Chainalysis Global Crypto Adoption Index for three consecutive years, ranking first across all categories in the 2025 edition.
What to watch for
The May 20 sittings could prove to be a turning point. With crypto exchange executives appearing directly before lawmakers, the committee is likely to press for details on consumer protection practices, compliance with Indian AML laws, the feasibility of tighter regulation, the impact of the current tax regime on trading volumes and the exchanges’ perspectives on what a comprehensive VDA framework should look like.
The inclusion of IFSCA in the agenda is equally notable. As the regulator of GIFT City, IFSCA’s stance on digital assets, particularly its decision to exclude crypto from permissible financial products, adds another layer to the discussion about how India should position itself in the global digital asset economy.
The committee’s findings and eventual recommendations are expected to inform the government’s approach to VDA regulation, a policy area that has remained in flux since the Supreme Court’s 2020 ruling in the Internet and Mobile Association of India (IAMAI) vs. Reserve Bank of India case struck down the RBI’s 2018 banking ban on crypto firms.
As India’s crypto user base, estimated at over 119 million in 2025, continues to grow, the pressure on lawmakers and regulators to move beyond a tax-only approach toward comprehensive governance has never been greater. The May 20 parliamentary sessions could be the most consequential step yet in that direction.
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