In a landmark judgment, the Madras High Court has ruled that cryptocurrency qualifies as “property” under Indian law, marking a major milestone for crypto regulation in India. This ruling officially recognizes digital assets as legally protectable property, granting investors stronger ownership rights and judicial safeguards.
Justice N Anand Venkatesh stated that while cryptocurrencies like XRP are neither physical assets nor legal tender, they exhibit the essential features of property.
| “It is not a tangible property nor is it a currency. However, it is a property capable of being enjoyed and possessed — capable of being held in trust,” he said. |
The judgment arose from a petition by an investor whose 3,532.30 XRP tokens (worth ₹1.98 lakh) were frozen after the WazirX crypto exchange hack in July 2024. The cyberattack, which primarily targeted Ethereum and ERC-20 tokens, caused losses exceeding $230 million and led to account freezes across the platform.
The petitioner argued that her XRP holdings were distinct from the hacked tokens and should not have been affected. The Madras High Court agreed, ruling that her assets were independently protected as property.
Justice Venkatesh rejected Zanmai Labs Pvt Ltd’s (the operator of WazirX) claim that user losses must be shared collectively under a Singapore court-mandated restructuring.
| “What were subjected to cyberattack were ERC-20 coins, which are completely different cryptocurrencies not held by the applicant,” he clarified. |
The court emphasized that cryptocurrency in India is already recognized under Section 2(47A) of the Income Tax Act, which classifies it as a Virtual Digital Asset (VDA). This reinforces the government’s position that digital currencies hold financial and legal significance in the Indian ecosystem.
Additionally, the court cited the Supreme Court’s PASL Wind Solutions v. GE Power Conversion India (2021) ruling to affirm its jurisdiction, noting that the investor’s transactions originated in Chennai and involved an Indian bank, bringing the matter under Indian legal authority.
The Madras High Court ruling sets a powerful precedent for crypto investors in India, offering clearer legal protection for cryptocurrency ownership and digital asset management.
Justice Venkatesh also called for stronger regulatory oversight of crypto exchanges and Web3 platforms, urging:
This judgment marks a turning point for cryptocurrency regulation in India, positioning digital assets as legitimate property and reinforcing investor trust in the crypto ecosystem. It also signals a growing alignment between India’s judicial system and digital finance, paving the way for more structured policies around crypto taxation, ownership rights, and security frameworks.
The Madras High Court’s recognition of cryptocurrency as property not only safeguards user interests but also strengthens India’s journey toward a transparent and accountable digital asset economy.
