Blockchain And VDA Sector Hopes For Regulatory Clarity And Investment Push In Budget

New Delhi, Jan 23 (KNN) Ahead of the Union Budget 2026, Virtual Digital Assets (VDA) and blockchain sector are expecting regulatory clarity and fiscal push to drive growth.

Industry players believe that continued regulatory uncertainty and a restrictive tax regime have dampened innovation and liquidity, reported ET.

In the upcoming budget they expect from the government a more balanced approach that supports the digital economy while managing risks.

The VDA and blockchain sector has repeatedly sought tax reforms, clear regulations and industry-friendly policies to attract investment and bring offshore innovation back to India, with clarity on tokenisation, blockchain and DeFi seen as key to positioning the country as a global hub.

Industry Calls for Rationalised Crypto Taxation

Vikas Gupta, Bybit India Country Manager, said Budget 2026 is a key opportunity to align regulation with growth. He suggested lowering the 30 percent VDA tax and 1 percent TDS to 0.1 percent to boost compliance, liquidity, and long-term participation. 

Clear regulations distinguishing enterprise blockchain from speculative crypto are also needed to drive Web3 innovation, entrepreneurship, job creation, and position India as a global hub for digital assets.

Measured Policy Approach Needed for VDA Ecosystem

SB Seker, Head of APAC, Binance, highlighted India’s growing digital asset adoption and called for measured regulatory and tax reforms in Budget 2026 to protect users, ensure financial stability, and support responsible market growth.

He proposed a capital-gains-based tax, limited loss set-off, and replacing transaction levies with net-revenue corporate taxation, signalling a shift from a ‘tax-and-deter’ to a ‘license-and-supervise’ approach.

Push for Long-Term Structural Support

Businesses are increasingly seeking long-term structural support rather than short-term tax changes, including clear regulations on digital assets, rationalised taxes to encourage domestic participation, and government initiatives that drive blockchain adoption across supply chains, identity management, and financial services.

The Union Budget is seen as a key opportunity to boost investment, innovation, and confidence in a promising yet under-supported sector. Establishing clear, consistent standards for VDA platforms, aligned with anti-money laundering and KYC rules and investor protections, is expected to foster responsible investment, job creation, and domestic capability development.

Demand for a Dedicated Crypto Law

Abhay Agarwal, Founder of Getbit, said the industry expects stronger regulatory guidance in Budget 2026, including a dedicated Crypto Bill and SEBI-aligned rules for bitcoin holdings. 

He added that rationalised taxes and revisiting the 1 percent Tax Deducted at Source (TDS) and 30 percent capital gains tax would boost liquidity, innovation, and sector oversight.

With over 100 million users, India has the world’s fastest-growing crypto base. Industry leaders say clearer policies and rationalised taxes in Budget 2026–27 could boost investment, confidence, and mainstream adoption of blockchain and digital assets.

(KNN Bureau)