Indian Tax Authority Probes 400 High-Net-Worth Traders on Binance
The Income Tax department of India has initiated a probe into over 400 Binance traders with high net worth. Led by the Central Board of Direct Taxes (CBDT), the Indian tax officials are suspicious of tax evasion in light of the nation’s strict cryptocurrency tax regulations.
This investigation seems to be concentrating on trading activities that are offshore. As per a report from the Economic Times dated October 11, 2025, it notes, “the individuals identified have avoided taxes on their crypto asset gains, with many not reporting the digital currencies stored in wallets with the overseas network.”
Notably, the probe is examining crypto transactions that occurred during the financial years 2022-2023 and 2024-2025. Both direct transactions and peer-to-peer (P2P) exchanges are under scrutiny. According to the department, these transactions could have been executed to evade tax responsibilities.
A follow-up report on this investigation is anticipated by October 17, 2025.
That tends to happen when you extort your citizens with 30% capital gains tax with no rekt adjustment, which basically means 40-50% tax.
— Chetan Kaul (@chetan_kaul) October 12, 2025
Indian Union Minister States “We Are Taxing Crypto Very Heavily”
Recently, Indian Union Minister Piyush Goyal stated the nation would not be promoting cryptocurrency, “which lacks sovereign backing or assets, say from the central bank or national currency.”
Goyal elaborated on India’s position regarding digital currency. He remarked, “Regarding digital currency, which is not supported by the Central Government, while there isn’t a formal ban, we impose heavy taxes on it. We don’t promote it, as we wish to prevent anyone from being stuck with a digital currency lacking backing and oversight.”
At present, India’s policy does not advocate for nor outright prohibits crypto. However, it enforces significant taxes on digital assets. These include a 30% capital gains tax and a 1% Tax Deducted at Source (TDS). These stringent taxes have been effective since July 2022.
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Binance’s Rough Journey in India
The largest exchange globally was prohibited from operating in India in 2023. It was determined that Binance had not adhered to India’s Money Laundering Act. After fulfilling legal requirements and incurring a significant fine of $2.25 million, the exchange re-entered the Indian market in 2024.
Vishal Sacheendran, Head of Regional Markets at Binance, shared that the firm was unable to onboard new users in India following the ban, which lasted until August 2024. Once the firm adjusted its KYC framework in line with the requirements set by India’s Financial Intelligence Unit (FIU), operations became more efficient.
In an interview with a local media outlet dated February 10, 2025, Sacheendran indicated that India is a crucial trading market in Binance’s strategy. The company expressed no desire to exit the country.
In December 2023, Indian authorities identified the company as unregistered with the FIU, leading to the blocking of Binance’s website and applications on both Android and Apple platforms.
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Key Takeaways
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Indian Tax officials have recognized several affluent traders who have not disclosed their cryptocurrency assets held in Binance wallets or reported earnings from trading on the offshore network.
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Binance’s operational situation in India has faced notable challenges over the last two years.
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