Indian High Court Recognizes Cryptocurrency as Property in Landmark Ruling
In a historic ruling that could reshape India’s digital finance landscape, the Madras High Court has officially recognized cryptocurrency as property under Indian law. The decision, delivered by Justice N. Anand Venkatesh, establishes that digital assets such as BTC, ETH, and XRP can be owned, transferred, and held in trust — providing long-awaited legal clarity to India’s growing crypto ecosystem.
The case, Rhutikumari v. Zanmai Labs Pvt Ltd, revolved around a dispute involving 3,532.30 XRP tokens held on the WazirX platform. The petitioner sought judicial protection to prevent the unauthorized transfer of her digital assets. The court was asked to determine whether cryptocurrency qualifies as property capable of being legally protected under existing Indian statutes.
Crypto qualifies as property, court rules
In its judgment, the Madras High Court ruled that cryptocurrency, while not legal tender, holds the essential characteristics of property. Referencing Section 2(47A) of the Income Tax Act, which defines “virtual digital assets,” the court found that digital currencies are capable of ownership and enjoyment similar to other forms of movable property.
“The nature of cryptocurrency, while intangible, does not preclude its recognition as property under Indian legal principles. It is capable of being held in trust and is subject to ownership rights,” Justice Venkatesh stated in his ruling. The court subsequently issued an interim injunction, restraining the transfer or dissipation of the disputed XRP assets pending further hearing.
Legal experts note that this is the first time an Indian court has directly recognized cryptocurrency as a form of property, a step that could influence future civil and commercial disputes involving digital assets. The decision provides a framework for handling issues related to theft, breach of trust, or inheritance involving cryptocurrencies.
Impact on India’s crypto regulation and taxation
This recognition could have significant consequences for India’s crypto regulation and tax enforcement. By treating cryptocurrency as property, Indian courts can extend established property law protections to digital assets — including remedies for fraud, misappropriation, and recovery. This also strengthens the legal foundation for applying capital gains tax and wealth declarations to crypto holdings.
The ruling aligns judicial interpretation with India’s current policy stance, where the Finance Act of 2022 officially categorized crypto as a “virtual digital asset” for taxation purposes. While the Reserve Bank of India continues to assert that crypto is not legal tender, this judgment clarifies that ownership and trust protections are valid under civil law.
Industry observers say the verdict could encourage greater institutional participation in India’s crypto market, which remains one of the world’s largest despite regulatory uncertainty. It may also influence government deliberations on a comprehensive crypto framework, expected to address taxation, investor protection, and platform licensing.
By aligning India with jurisdictions such as Singapore, the United Kingdom, and the United States — where digital assets are recognized as property — the Madras High Court’s decision marks a pivotal moment in the country’s legal treatment of cryptocurrency. Analysts believe the ruling provides a critical foundation for future litigation and sets a strong precedent for recognizing digital assets within India’s legal and financial systems.
