India to Start Global Crypto Transaction Reporting From April 2027

TLDR

• India will start cross-border crypto data exchange in April 2027

• CARF is developed by the OECD to track global digital asset flows

• Budget 2026 sets ₹200 daily and ₹50,000 flat penalties for violations

• Indian retail investors increase crypto buying during price corrections

India will begin sharing and receiving data on cross-border crypto transactions from April 1, 2027, under the Crypto-Asset Reporting Framework (CARF). The framework was created by the Organisation for Economic Co-operation and Development (OECD) to support tax authorities in tracking crypto activities across borders.

Officials confirmed that the technical details for data exchange are being finalized and should be available in the coming months. The mechanism will function similarly to existing systems used for banking data, aiming to support global coordination on tax enforcement.

Authorities noted that most crypto trading by Indian users occurs through offshore platforms, making oversight difficult. With CARF, India aims to reduce these challenges by receiving automatic updates on user activity abroad.

India Budget 2026 Introduces Crypto Penalties

The Union Budget 2026 proposes new compliance rules for crypto platforms, effective April 1, 2026. Entities failing to report transactions as required will face a daily penalty of ₹200. A fixed penalty of ₹50,000 will apply to incorrect filings or non-correction of errors.

Finance Minister Nirmala Sitharaman stated these measures aim to strengthen adherence to the Income-tax Act, 2025. The move is also seen as a step toward preparing for participation in the global CARF system.

The government will work with crypto exchanges and intermediaries to help manage operational and technical challenges linked to compliance. The new penalties add to existing taxes on crypto introduced in 2022, which include a 30% tax on profits and 1% tax deducted at source.

Investor Behavior Shifts as Markets Evolve

Despite broader market volatility, Indian crypto investors are showing new patterns in response to price corrections. According to data from CoinDCX, local investors increased their accumulation of digital assets such as Bitcoin during recent downturns.

CoinDCX noted that participants are using more structured investment approaches. These include systematic purchase plans that spread out capital deployment over time. This helps investors reduce the risks tied to market timing and encourages consistent buying during market dips.

The shift indicates that retail investors in India are moving away from short-term speculation. Instead, they are focusing on diversified portfolios and disciplined investment habits.

Retail and Institutional Growth Support Broader Adoption

CoinDCX reported that crypto adoption is expanding beyond India’s major urban centers. Increased participation from smaller cities has contributed to growing trading volumes and improved liquidity on domestic platforms.

Meanwhile, institutional interest in digital assets is also rising. This has reinforced longer-term capital allocation strategies and contributed to more stable market activity. The trend points to a broader structural change in how Indian users engage with crypto assets.

Officials believe that improved transparency, combined with CARF and new penalties, will enhance supervision of crypto markets. India’s adoption of international frameworks also aligns with guidance from the Financial Action Task Force, which supports stronger cross-border oversight of digital assets.

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