Binance, WazirX, ZebPay Summoned by Parliament Panel On May 20 Over VDAs

The Parliamentary Standing Committee on Finance is set to hold discussions with representatives from crypto exchanges Binance, WazirX, and ZebPay on May 20 as part of its ongoing study on Virtual Digital Assets (VDAs) and their future in the country. The session will be chaired by BJP MP Bhartruhari Mahtab. As per the official notice issued by the Lok Sabha Secretariat on May 13, the meeting will take place at the Parliament House Annexe in New Delhi and will also include representatives from the International Financial Services Centre Authority (IFSCA), the Ministry of Finance, and the Ministry of Corporate Affairs. Separate sessions are scheduled for the day by this committee under the subject, “A Study on Virtual Digital Assets (VDAs) and Way Forward.” 

Lawmakers to Examine Crypto Regulation, Taxation, and Compliance

The document states that the first session will feature representatives from ZebPay, Binance, and WazirX, scheduled between 11am IST and 12:30pm IST. The second session will begin with oral evidence from each representative of the International Financial Services Centre Authority (IFSCA), scheduled between 12:30pm IST and 1:30pm IST. The third session, beginning at 2pm IST, will involve officials from the Ministry of Finance's Department of Revenue and the Ministry of Corporate Affairs. The move to organise this meeting comes at a time when the crypto industry continues to operate in a regulatory gray area despite heavy taxation rules being in place. 

The upcoming meeting may focus on multiple subjects surrounding the crypto sector, which primarily includes taxation, investor protection, and the broader regulatory framework for digital assets in the country. While the government has previously acknowledged the adoption and use of crypto assets in the country, regulators have repeatedly emphasised the need for better crypto education in the country before introducing a comprehensive framework for this sector. 

In the last few years, India's crypto policy discussions have remained largely open-ended. In 2024, Minister of State for Finance Pankaj Chaudhary informed the Lok Sabha that the government did not have a specific timeline to finalise regulations for VDAs. He stated that VDAs, such as cryptocurrencies, are borderless in terms of usage, adding that regulations would require international cooperation. Chaudhary further added that “the need to balance investor protection and innovation must be assessed in light of the broader objective of protecting the Indian economy from the risks posed by the VDA sector.”

All three of these exchanges that have been called upon for the parliamentary discussion have something more in common: these exchanges were involved in investigations related to crypto-linked financial activities in India. In 2024, the Enforcement Directorate (ED) seized approximately Rs. 90 crore worth of crypto assets stored in wallets linked to Binance, ZebPay, and WazirX as part of a money laundering probe tied to online gaming and betting applications. The case was once again an eye-opener and brought attention to concerns surrounding digital asset transactions and compliance obligations for crypto platforms operating in India.  

India's legal approach towards cryptocurrencies also witnessed a significant shift last year when the Madras High Court recognised cryptocurrencies as a form of property under Indian law. Now, digital assets like Bitcoin, Ethereum, and XRP can be owned, transferred, and held in trust. This judgment marks the first time an Indian court has directly classified cryptocurrency as a form of property, giving investors and businesses a firmer legal footing for transactions and dispute resolution. The case that led to this ruling, Rhutikumari V. Zanmai Labs Ovt. Ltd (WazirX), involved a dispute over 3,532.30 XRP tokens allegedly transferred without authorisation from the petitioner's account on the WazirX exchange.

The parliamentary sittings on May 20 could prove to be a turning point for India's crypto sector, as crypto exchange executives appear directly before lawmakers. The committee is likely to seek details on consumer protection measures, compliance laws, the practicality of tighter regulations, the impact of the current tax regime on crypto trading volumes, and what a comprehensive VDA framework should look like. As India's crypto user base increases, lawmakers and regulators will have to face the hurdle of moving beyond a tax-only approach. Hence, this parliamentary session could emerge as one of the most significant steps in shaping India's crypto regulatory landscape.