Supreme Court Rulings On Cryptocurrency Theft
1. Internet and Mobile Association of India v. Reserve Bank of India (2018)
Case Overview:
In 2018, the Reserve Bank of India (RBI) issued a circular that prohibited banks and financial institutions from providing services related to virtual currencies, effectively curbing cryptocurrency transactions. The Internet and Mobile Association of India (IAMAI) challenged this circular, arguing that it was unconstitutional and disproportionate.
Supreme Court Ruling:
The Supreme Court struck down the RBI's circular, stating that the banking ban was a disproportionate measure. The Court emphasized that while the RBI had the authority to regulate financial institutions, it could not impose a blanket ban on cryptocurrencies without adequate justification. This judgment was a significant step in recognizing the legality of cryptocurrency trading in India.
Legal Implications:
The ruling highlighted the need for a balanced approach to regulation, ensuring that measures taken are not excessive and are backed by sufficient reasoning. It also underscored the importance of a clear legal framework to address issues related to cryptocurrencies, including theft and fraud.
2. Supreme Court's Observations on Cryptocurrency Regulation (2025)
Case Overview:
In 2025, during hearings related to a cryptocurrency fraud case, the Supreme Court expressed concerns over the lack of a regulatory framework for cryptocurrencies in India. The Court noted that the absence of regulation had created a fertile ground for misuse and likened unregulated Bitcoin trading to a more polished form of hawala.
Supreme Court Observations:
The bench questioned the central government about the prolonged inaction on regulating cryptocurrencies and emphasized the need for oversight and regulatory measures. The Court's observations highlighted the growing urgency for a comprehensive legal framework to address the challenges posed by digital assets.
Legal Implications:
These observations underscored the judiciary's recognition of the risks associated with unregulated cryptocurrency markets, including theft and fraud. They also signaled the need for legislative action to establish clear guidelines and protections for investors and stakeholders in the cryptocurrency ecosystem.
3. Delhi Court's Recommendation for CBI Investigation in Rs 2,000 Crore Crypto Fraud (2025)
Case Overview:
In 2025, a Delhi court recommended that the Central Bureau of Investigation (CBI) take over the investigation of a major cryptocurrency fraud case involving approximately Rs 2,000 crore. The case emerged after a cyberattack on WazirX, a cryptocurrency platform, led to wallet breaches and significant financial losses.
Court's Recommendation:
The court highlighted the sophisticated nature of the fraud, potential involvement of global syndicates, and the need for a national-level investigation. The recommendation underscored the complexity of cryptocurrency-related crimes and the necessity for specialized agencies to handle such cases.
Legal Implications:
This development emphasized the challenges law enforcement faces in investigating cryptocurrency-related crimes, given the decentralized and pseudonymous nature of digital assets. It also pointed to the need for enhanced coordination between agencies and the establishment of specialized units to tackle cybercrimes effectively.
4. Supreme Court's Critique of Government's Approach to Cryptocurrency Regulation (2025)
Case Overview:
In 2025, during the hearing of a bail petition related to cryptocurrency fraud, the Supreme Court criticized the government's approach to regulating cryptocurrencies. The Court noted that the absence of a clear legal framework had created a fertile ground for misuse and likened unregulated Bitcoin trading to a more polished form of hawala.
Supreme Court's Critique:
The bench questioned the central government about its prolonged inaction on regulating cryptocurrencies and emphasized the need for oversight and regulatory measures. The Court's critique highlighted the growing urgency for a comprehensive legal framework to address the challenges posed by digital assets.
Legal Implications:
These remarks underscored the judiciary's recognition of the risks associated with unregulated cryptocurrency markets, including theft and fraud. They also signaled the need for legislative action to establish clear guidelines and protections for investors and stakeholders in the cryptocurrency ecosystem.
5. Delhi High Court's Denial of Bail in Cryptocurrency Scam Case (2025)
Case Overview:
In 2025, the Delhi High Court denied bail to an individual accused in a cryptocurrency scam involving the Dubai-based Pluto Exchange. The court emphasized the detrimental economic implications of cryptocurrency-related fraud, describing it as a threat due to the conversion of legitimate money into untraceable funds.
Court's Decision:
Justice Girish Kathpalia underscored the accused's history of fraudulent behavior, including involvement in multiple similar cases, and labeled him a serious flight risk. The court noted that the investigation was ongoing and more victims were surfacing, justifying the denial of bail.
Legal Implications:
This decision highlighted the judiciary's recognition of the severity of cryptocurrency-related crimes and the need for stringent measures to deter such offenses. It also underscored the importance of protecting the interests of investors and maintaining the integrity of financial markets.
Conclusion:
While there isn't a specific Supreme Court case solely focused on cryptocurrency theft, the Court's rulings and observations have significantly influenced the legal landscape surrounding digital assets in India. The judiciary has consistently emphasized the need for a balanced regulatory approach to address the challenges posed by cryptocurrencies, including issues related to theft and fraud. These developments underscore the importance of establishing a clear legal framework to protect investors and ensure the integrity of the financial system.
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