Union Home Minister Amit Shah announced that the Government of India has constituted a dedicated Darknet-Crypto Cell inside a high-level anti-narcotics task force, formalizing a specialized investigative unit that will trace cryptocurrency payments, encrypted communications and physical dead-drop drug deliveries.
The Home Ministry did not announce a new law for virtual digital assets, a ban on private crypto, or any change to India’s existing tax rules on crypto trading.
Shah announced this at a press conference held on September 6, 2026, in Panaji, Goa, alongside Goa Chief Minister Pramod Sawant. The briefing followed a review meeting on state issues chaired by the Home Minister and was framed as part of a broader roadmap the Ministry of Home Affairs (MHA) has set out to make India drug-free by 2029. Shah confirmed the event on his verified account on the social media platform X, sharing a live broadcast of the address.
According to a dispatch by news agency Asian News International (ANI) from Dona Paula, Goa, Shah said the government had “initiated technology-enabled investigations targeting darknet activities, encrypted communications, crypto-payments, and ‘dead-drop’ delivery methods, and established a dedicated Darknet-Crypto Cell within the Task Force.”
A separate ANI note on the same day carried Shah’s response on courier and postal deliveries of narcotics, in which he said the government did not yet have a “leak-proof plan” for parcel-based drug movement and that a fresh strategy was still being developed.
The Home Minister also cited the Prevention of Illicit Traffic in Narcotic Drugs and Psychotropic Substances Act, 1988 (PIT-NDPS), a preventive-detention statute aimed at drug traffickers, and said financial investigations would run alongside physical seizures.
He described a two-way investigative model, tracing a small street-level seizure back to the supply network and tracking large border seizures forward to end users. Shah added that proceeds from narcotics were being routed into terror financing and that the government had “broken financial chains” of drug networks since 2019.
Enforcement announcement, not a market rule change
For crypto investors and industry operators in India, the Goa press conference sits on the enforcement side of the country’s split policy. Buying, selling and holding cryptocurrency is not banned in India, though private cryptocurrencies are not treated as legal tender by the Reserve Bank of India (RBI), the country’s central bank.
The RBI has, in submissions to parliamentary committees through 2025 and 2026, consistently opposed granting legal status to private cryptocurrencies, while the Ministry of Finance has continued with a taxation-and-compliance framework rather than a prohibition.
Under that framework, income from the transfer of a virtual digital asset (VDA), a category defined under Section 2(47A) of the Income Tax Act, 1961, that covers cryptocurrencies and non-fungible tokens, is taxed at a flat 30% under Section 115BBH, with only the cost of acquisition allowed as a deduction.
A 1% Tax Deducted at Source (TDS) applies under Section 194S on qualifying transfers above statutory thresholds. Losses on VDAs cannot be set off against other income. The Central Board of Direct Taxes (CBDT), India’s apex direct-tax authority, issued detailed 2026 reporting guidance for crypto-asset service providers, tightening disclosure without altering the levy.
Crypto exchanges dealing with Indian users are also expected to register with the Financial Intelligence Unit-India (FIU-IND), the country’s national anti-money-laundering agency, and to file suspicious transaction reports (STRs) under the Prevention of Money Laundering Act, 2002 (PMLA). As of the FIU-IND’s most recent annual report, 49 virtual digital asset service providers had registered as reporting entities, including 45 India-based platforms and four offshore exchanges serving Indian users, and the unit has since tightened Know-Your-Customer (KYC) requirements with measures such as live-selfie verification.
The new Darknet-Crypto Cell operates within that policy architecture. It is not a market regulator and does not replace the FIU-IND or the Income Tax Department. Contemporaneous reporting of Shah’s remarks describes the cell as an investigative unit sitting inside the anti-narcotics task-force structure of the MHA.
Not a new theme for New Delhi
Home ministry warnings about darknet marketplaces and crypto payments in narcotics cases go back several years. Speaking at the 2nd National Conference of Anti-Narcotics Task Force (ANTF) Heads of States and Union Territories in New Delhi on September 16, 2025, Shah had asked states to adopt technologies such as darknet analysis, cryptocurrency tracking, communication-pattern analysis and machine-learning models to curb drug cartels. He has referenced the dark web and cryptocurrency as investigative challenges in narcotics cases in similar forums since October 2022.
Investigative capacity has been built up over the past year. India’s Narcotics Control Bureau (NCB), the federal anti-narcotics agency, ran specialized training programmes for state ANTF officers at Rashtriya Raksha University in June and August 2026, covering darknet investigation, cryptocurrency tracing and digital evidence handling.
Officials involved in the second training round said syndicates were increasingly using darknet marketplaces, encrypted messaging platforms and cryptocurrencies to buy, sell and move narcotics.
NCB casework has provided concrete examples of that shift. Earlier in 2026, the agency dismantled a pan-India darknet drug network called “Team Kalki” that allegedly used the encrypted messaging platform Session, the darknet forum Dread and dead-drop deliveries.
Crypto exchange Binance said on July 22, 2026, that its investigations team, along with the Data Security Council of India (DSCI), a not-for-profit industry body set up by the National Association of Software and Service Companies (NASSCOM), had provided blockchain analytics and wallet tracking that helped authorities identify and freeze cryptocurrency assets linked to the network. In an earlier operation code-named MELON in 2025, the NCB dismantled a Level-4 darknet vendor operating under the alias “Ketamelon” and seized cryptocurrency worth around ₹70 lakh, along with LSD blots and ketamine.
In a separate case being investigated by the Gujarat Criminal Investigation Department (CID) Crime’s Cyber Centre of Excellence, Binance publicly confirmed its assistance in tracing alleged illicit crypto flows worth about ₹226.54 crore, or roughly $23.96 million, tied to an Ahmedabad-based accused whose wallet was allegedly linked to a dark web narcotics marketplace.
Investigators said the group used the privacy-focused cryptocurrency Monero alongside the stablecoin Tether (USDT). India’s Enforcement Directorate (ED), the federal financial-crimes agency under the Ministry of Finance, has separately arrested the alleged mastermind of a US call-centre scam that routed proceeds through Bitcoin, crypto exchanges and informal hawala channels back into India.
India’s Directorate of Revenue Intelligence (DRI), the anti-smuggling arm of the Central Board of Indirect Taxes and Customs (CBIC), flagged the same broader shift in its “Smuggling in India Report 2024-25,” released in December 2025.
The report said certain smuggling syndicates had moved from traditional hawala channels to cryptocurrency and stablecoins because of settlement speed and weaker anti-money-laundering compliance across jurisdictions. It cited a 108-kilogram gold smuggling case in which investigators tracked more than $12.7 million routed through hawala and USDT to a Chinese syndicate.
What the September 6 briefing did not say
The Goa briefing did not name Bitcoin, Ether, USDT, or any specific exchange, and did not provide seizure figures tied only to crypto wallets. Shah did not indicate that ordinary VDA investors on FIU-registered exchanges would face action under PIT-NDPS. Asked about deliveries through post and courier services, he acknowledged the current plan was not leak-proof and said further details would be shared at a later date.
The Home Minister also did not announce a fresh crypto regulation bill, a discussion paper timeline, or any position on stablecoins. India’s long-anticipated crypto discussion paper, prepared by the Department of Economic Affairs (DEA), has been deferred multiple times, most recently in the ongoing 2026 monsoon session.
A Reuters report on July 8, 2026, later cited across financial and policy media, said the RBI’s internal submissions to the Union government had backed a prohibition on private cryptocurrencies, on the argument that formal regulation could effectively grant them legitimacy. The government has not acted on that recommendation, and the RBI’s containment posture has so far shaped policy from the sidelines rather than through statute.
Bottom line for crypto readers
The September 6 press conference is a primary-source confirmation that the Home Ministry wants narcotics investigations to routinely follow blockchain and darknet trails, and that a named unit now exists inside the anti-narcotics task force to run those probes.
The announcement builds specialized enforcement capacity. It does not rewrite India’s tax code, alter the FIU-IND registration regime for VDA service providers, or change the legal status of ordinary crypto trading. The 30% income tax on VDA transfers under Section 115BBH, the 1% TDS under Section 194S, and PMLA reporting obligations for reporting entities all remain in place as they stood before the Goa briefing.
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