A blockchain development company in India can draw on one of the largest pools of Web3 engineers in the world. Running a consumer crypto business in India is harder, because anti-money-laundering registration and a strict tax regime apply. This guide covers the rules, the talent market, public projects, and how to check a firm before you hire it.
The rules for crypto businesses in India
India has not banned cryptoassets, and it has no complete law for them, so the government regulates them through anti-money-laundering law and tax law. The Reserve Bank of India (RBI) has said openly that it doubts private cryptocurrencies.
FIU-IND registration
Since March 2023, businesses that exchange, transfer or hold virtual digital assets (VDAs) for customers are reporting entities under the Prevention of Money Laundering Act, and some services linked to token issuance are also covered. These businesses must register with the Financial Intelligence Unit – India (FIU-IND), check customer identity, keep records and report suspicious transactions.
The registration rule also covers offshore platforms that serve Indian users. In December 2023 FIU-IND sent notices to several large offshore exchanges, and the government blocked their websites. Some of those exchanges later registered and paid penalties before they resumed service.
Tax
- 30% tax on VDA gains, plus surcharge and cess, from the 2022–23 financial year. Only the purchase cost can be deducted, and losses cannot be set off against other income or against other VDA gains.
- 1% TDS, a tax deducted at source on VDA transfers above set thresholds, from July 2022. Exchanges, and in some cases buyers, must deduct and pay it.
- GST applies to platform services such as trading fees.
The Union Budget for 2026-27 kept the 30% rate and the 1% TDS. From 1 April 2026 the Budget also added penalties for platforms that file VDA transaction statements late or with wrong details.
The TDS changed how people trade, because the TDS holds back part of the money on every trade. High-frequency trading and market making on Indian platforms became more costly. A trading or DeFi product with Indian users needs these tax flows in its product design and back office from the start.
Other rules
In 2020 the Supreme Court set aside a 2018 RBI circular that had stopped banks from serving crypto businesses, but banks still treat crypto firms with caution. The RBI has run pilots of the digital rupee (e₹) for wholesale and retail use since late 2022. The Digital Personal Data Protection Act 2023 also affects how a product stores user data, including any personal data a team might put on-chain.
Blockchain companies in India: hubs and public projects
Bengaluru, Hyderabad, Pune, Chennai, Mumbai and the Delhi region have large software workforces. A large share of global Web3 engineering is done by Indian developers, including work for protocols based in other countries. Solidity, Rust and Go developers are easier to find than in most markets, and hackathons are common.
Several public names show the range of the sector:
- Polygon, an Ethereum scaling network, was founded by Indian engineers in 2017 under the name Matic.
- CoinDCX and CoinSwitch are Indian crypto exchanges that operate under FIU-IND registration.
- WazirX, an Indian exchange, lost about $230 million in a hack in July 2024, and its users then waited through a long restructuring.
- The National Blockchain Framework of the Ministry of Electronics and IT (MeitY) launched the Vishvasya blockchain stack in September 2024. Vishvasya offers permissioned blockchain as a service to government bodies from data centers of the National Informatics Centre.
The tax regime has led many founders to register the company in Dubai or Singapore and keep engineering in India.
How to vet a blockchain development company in India
The Indian market ranges from strong protocol engineers to firms that resell the same white-label scripts under different names. Checks matter more here than in smaller markets because the range of quality is wider.
Signs of a strong team
- Public code, such as GitHub repositories, audit reports on the firm's contracts, or contributions to open-source protocols.
- Engineers you can interview directly, not only a sales manager.
- A clear testing and security process: unit tests, fuzz tests, internal review, and an independent smart contract audit before mainnet.
- Honest scoping, including pushback on timelines that cannot work.
Red flags
- Fixed-price "clone scripts" for exchanges or DeFi protocols that promise a launch in days. Read the notes on white-label exchanges before you buy one.
- Reluctance to put the code in your own repository from the first day.
- A portfolio of products that you cannot find live on-chain.
Working with an Indian team
Indian working hours overlap well with Europe and partly with the US East Coast. Teams that work well with foreign clients usually assign a technical lead who writes the specifications, sends them to the client for review and runs regular demos. If your product serves Indian users, a firm that has built FIU-IND reporting and TDS deduction saves time. For products aimed at other countries, engineering quality matters most. Costs are lower than in North America or Western Europe. Senior protocol and security engineers are the exception, because companies around the world hire them and pay close to international rates.
The blockchain consulting guide covers vendor selection in more depth. The UAE guide and the Singapore guide describe the two hubs where many Indian founders register, and the regional guide compares nine markets.
Frequently asked questions
Is crypto legal in India?
Owning and trading cryptoassets is not banned. VDA service providers must register with FIU-IND and follow anti-money-laundering rules, and gains are taxed under specific rules.
Can an Indian startup issue its own token?
India has no specific framework for token offerings, so issuing a token carries legal uncertainty, and token transfers also fall under the VDA tax rules. Many teams issue tokens through a company abroad, which raises its own legal and tax questions.
Do offshore exchanges need to register in India?
Yes, if they serve Indian users. FIU-IND has said so and has enforced the rule since 2023.
Is hiring a blockchain development company in India cheaper?
For most roles, yes. Senior smart contract security and protocol engineers are the exception, because global demand has pushed their pay close to international levels.