The cryptocurrency story in India is moving forward, but not without friction. In an exclusive conversation with Coinpedia, CoinSwitch co-founder Ashish Singhal explains the current situation, from CBDCs and UPI dominance to Budget 2026, taxes, and why startups are quietly looking abroad.
UPI dominates, but central bank digital currency (CBDC) plays a different game
Singhal explains that India does not lack payment solutions. The Unified Payments Interface has made transactions really easy, whether it’s paying vendors or splitting invoices.
But CBDC does not compete with UPI. It’s something deeper.
He explains that a central bank digital currency (CBDC) is essentially digital money issued by the central bank, like an INR 100 note, but on your phone. Its real power lies in its targeted use cases. Government subsidies can be programmed for specific spending, and emergency funds can reach citizens immediately without intermediaries.
As he put it, UPI is the “road”, while CBDC becomes a new “vehicle” on it. For users, the experience may not change, but the backend becomes much stronger.
Budget 2026: Clarity without relief
India Budget 2026 It kept cryptocurrency taxes unchanged, continuing one of the toughest regulations in the world.
Singal does not see this as an attempt to kill participation in retail, but rather to control it. This framework has brought clarity and improved traceability, even if higher taxes and 1% TDS have pushed some activities offshore.
He points out that the government is prioritizing responsible investment and compliance first. But in the future, a more balanced tax structure, in line with other asset classes, could open the door to real growth while maintaining innovation within India.
Startups are watching… and taking action
Moreover, regulatory uncertainty remains a greater concern than taxes.
Singhal points out that many Web3 founders are drifting towards hubs such as Dubai, Singapore and Hong Kong, where clearer rules make it easier to access banking, capital and partnerships.
India still has a strong advantage in the form of a huge developer base and user market. But without clear and proportionate regulation, this advantage may slowly be eroded.
Bitcoin ETFs and What Comes Next
On the issue of Bitcoin ETFs, Singhal takes a firm view.
He says India is still figuring out the basics, how to classify crypto assets, who regulates them, and how to protect investors. Products like ETFs will only come about once this foundation is laid.
However, it is difficult to ignore the global momentum, especially after the approval of the European American Investment Corporation. Institutional demand in India is already growing, especially among investors seeking exposure without holding cryptocurrencies directly.
Why is regulation slower than adoption?
Singhal ends with a reality check.
Cryptocurrencies are not just another sector; It touches on capital controls, taxation, anti-money laundering, and financial stability. This means that many regulatory bodies are involved, which naturally slows things down.
He says India is adopting a “risk-first” approach, building guardrails through tax and compliance while watching how global frameworks evolve.
Adoption, meanwhile, doesn’t wait. It is market driven, fast and really ahead of politics.
And this gap, between speed and structure, is where the future of cryptocurrencies in India will ultimately be decided.
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