The U.S. playbook on tokenised securities has entered India’s parliamentary debate, as lawmakers point to Washington’s framework as a model for safer digital asset investing.
Indian parliament member Raghav Chadha has suggested that the nation should look towards following the U.S. SEC-style tokenisation rules, providing a legal framework for digital units of real-world assets.
The comments follow Indian Finance Minister Nirmala Sitharaman presenting her ninth consecutive Union Budget in Parliament on February 2.
For the crypto industry, however, there were no major policy changes. The government chose to keep existing tax rules on crypto income and transactions unchanged.
In fact, rather than offering tax relief or incentives, the finance ministry introduced stricter penalties for investors who fail to comply with reporting and tax obligations.
The speech comes as the politician’s second attempt to stir a conversation around digital assets in the Indian parliament.
Tokenization could make asset ownership easy, says Chadha
Crypto assets ownership is a rather cumbersome task in India with incomes taxed by 30 percent. Additionally, one percent TDS (tax deducted at source) is also collected on each step of a crypto transaction.
Chadha famously critiqued the government’s approach by stating, “We tax virtual digital assets as if they are legal, but regulate them as if they are illegal.”
The Indian politician went ahead to highlight that the U.S. SEC has already incorporated tokenization into its Securities Act, providing a legal framework for digital units of real-world assets.
He argues that tokenization can do for asset ownership what “UPI did for payments”, making it inclusive for the common man to own fractions of expensive assets like office buildings, highways, and infrastructure.
UPI stands for Unified Payments Interface and is a real-time, instant payment system developed by the National Payments Corporation of India (NPCI) in 2016.
Regulate virtual digital assets, bring crypto onshore
In his speech in the Parliament, MP Raghav Chadha called for clear rules to regulate virtual digital assets (VDAs) and bring cryptocurrency trading onshore in India.
He further stressed that proper regulation would protect investors while allowing India to tap into the growing digital asset market.
Without such a framework, he warned, Indian crypto assets could be traded mostly on foreign platforms, risking “sovereign data loss and lost economic opportunities”.
Chadha warned that without clear laws, India is losing wealth and talent, noting that ₹4.8 lakh crore ($52 billion – $58 billion) in trade and over 180 startups have already moved to hubs like Dubai and Singapore.
India still behind the blockchain revolution
One of Raghav Chadha’s major arguments and critics for the current ruling government is the lack of use of blockchain. The politician highlights that the use of blockchain globally has given rise to less cumbersome government sectors.
He goes on to propose moving all land and property records to a blockchain-based ledger to eliminate India’s massive backlog of civil land disputes (which account for 66 percent of civil cases).
Additionally, he has called for a “Regulatory Sandbox” where Indian fintech companies can test blockchain products under government supervision without fear of legal ambiguity.
His core philosophy remains that “Prohibition is not protection; regulation is protection,” urging the government to “ring-fence” the ecosystem rather than ignoring it.