In a landmark ruling that could reshape India’s digital-asset landscape, the Madras High Court has held that cryptocurrency qualifies as a form of “intangible property” under Indian law. The decision, delivered by Justice N. Anand Venkatesh, aligns India with global judicial thinking in jurisdictions such as the UK, Singapore, and the US, where courts have long recognised crypto assets as a form of property.
Background of the Case
The judgment arose from a petition filed by Rhutikumari, who owned 3,532.30 XRP coins through the WazirX exchange (operated by Zanmai Labs Pvt Ltd). Following a major cyber-hack on the platform in July 2024, her crypto assets were frozen. Seeking protection of her holdings, she approached the Madras High Court under Section 9 of the Arbitration and Conciliation Act, 1996, asking the court to restrain WazirX from redistributing or interfering with her digital assets pending arbitration proceedings.
The Court’s Key Observations
Justice Venkatesh’s detailed ruling makes several important observations:
- Cryptocurrency is property, not currency.
The Court clarified that while cryptocurrencies are not legal tender, they are nevertheless capable of being “possessed, enjoyed, and held in trust”. Thus, they fall squarely within the broader legal meaning of “property.”“There can be no doubt that cryptocurrency is property. It is not a tangible property, nor is it a currency. However, it is a property capable of being enjoyed and possessed (in a beneficial form). It is capable of being held in trust.”
- Recognition under Indian statutes.
The Court noted that under the Income-tax Act, 1961, cryptocurrency is already defined as a “virtual digital asset” under Section 2(47A). Its recognition as property under general law therefore aligns with the legislative intent behind India’s taxation of crypto transactions. - Jurisdictional reach.
Even though WazirX’s user agreement provided for arbitration in Singapore, the Court held that it could still grant interim relief since the cause of action partly arose in India—where the user resided and transacted. - Protection of investor property.
The Court directed WazirX to furnish a bank guarantee or deposit approximately ₹ 9.56 lakh in escrow to secure the value of the petitioner’s holdings until arbitration is complete.
Why This Judgment Matters
This is among the first judicial pronouncements in India that formally recognises cryptocurrencies as property, providing long-awaited clarity for investors, exchanges, and regulators.
The implications are far-reaching:
- Taxation: Gains from sale or transfer of cryptocurrencies will continue to be taxed under the virtual digital asset (VDA) framework, but the Court’s reasoning strengthens their treatment as capital assets rather than speculative instruments.
- Inheritance & Estate Planning: Crypto holdings can now be more confidently included in wills and trusts, ensuring smoother succession and transfer.
- Insolvency & Custody: Recognising crypto as property implies that exchanges may hold user assets in trust, protecting users in cases of platform insolvency or hacking incidents.
- Contract Enforcement: The ruling paves the way for Indian courts to grant interim relief in disputes involving crypto, even when foreign arbitration clauses exist.
Aligning India with Global Practice
The judgment mirrors similar positions taken in other countries—such as Ruscoe v. Cryptopia Ltd (New Zealand, 2020) and AA v. Persons Unknown (UK, 2019)—where courts held that digital assets, though intangible, enjoy property status and the protection that accompanies it.
What’s Next
While this is a single-bench decision, it sets a persuasive precedent for other High Courts and regulatory bodies. It may influence future cases involving taxation, inheritance, insolvency, and contractual disputes around digital assets. However, India still lacks a comprehensive crypto-specific regulatory framework, and legislative clarity will be critical to fully operationalise this recognition.
Final Thoughts
The Madras High Court’s decision marks a turning point in India’s legal understanding of digital assets. For investors, it provides a layer of security and legitimacy; for policymakers, it signals the urgency of framing a coherent regulatory regime; and for legal practitioners, it opens new frontiers in property, trust, and taxation law.
In short, Indian law has taken a decisive step towards the mainstream legal recognition of crypto assets—as property, not just pixels.