Supreme Court Flags Centre’s Inaction On Crypto, Warns Of Misuse Risks

The Supreme Court has criticised the central government for delaying regulation of cryptocurrencies, warning that the legal vacuum has led to widespread misuse.

It noted that unregulated Bitcoin trading closely resembles Hawala, an illegal money transfer system.

The remarks came from a bench comprising Justices Surya Kant and N Kotiswar Singh during a hearing on a bail plea filed by a Gujarat man accused of crypto-related fraud across several states.

The judges reminded the government that nearly two years ago, the court had asked for clarity on India’s stance on virtual currencies.

They said an outright ban would be shortsighted, as digital finance continues to evolve globally—but stressed that some form of regulation is urgently needed.

While Additional Solicitor General Aishwarya Bhati requested time to seek instructions, the court also flagged the difficulties law enforcement faces in the absence of clear legal definitions or frameworks for crypto assets.