In a landmark speech delivered during the Union Budget session on February 9, 2026, Rajya Sabha MP Raghav Chadha moved past standard political rhetoric to deliver a data-heavy roadmap for the future of India’s digital economy. Chadha argued that India is currently at a crossroads: it can either continue its restrictive “grey-zone” policies or become a global hub for the next wave of financial innovation.
The “Taxation Paradox”: A Systemic Failure
Raghav Chadha highlighted a glaring contradiction in India’s current fiscal stance. While the government collects a 30% flat tax on VDA gains and a 1% TDS on every transaction, it has yet to provide a formal regulatory framework or classification for the assets.
“We are taxing VDAs as if they are perfectly legal, yet we refuse to regulate them, treating the sector as if it were illegal,” Chadha noted.”
He argued that this “taxation without protection” approach has failed to curb interest in the sector, instead only succeeding in pushing Indian capital and talent offshore to more progressive jurisdictions.
The Cost of Inaction: By the Numbers
To underscore the urgency of his call for reform, Raghav Chadha presented several striking statistics regarding the flight of capital from the Indian economy:
- ₹4.8 Lakh Crore Drain: Roughly ₹4.8 lakh crore in trading volume has migrated from domestic platforms to offshore exchanges.
- 73% Volume Migration: In the last fiscal year, nearly three-quarters of India’s crypto trading activity moved to foreign entities.
- Startup Brain Drain: Approximately 180 Indian Web3 startups have relocated their headquarters to hubs like Dubai, Singapore, and London.
- Missing Revenue: Chadha estimated that a regulated “onshore” framework could contribute between ₹15,000 and ₹20,000 crore in annual tax revenue to the treasury.
The “India Tokenization Bill”: Democratizing Wealth
The centerpiece of Raghav Chadha’s “Way Forward” was a proposal for a bespoke India Tokenization Bill. He drew a direct parallel to the UPI revolution, suggesting that blockchain technology could do for asset ownership what UPI did for payments.
Key Reform Proposals:
- Fractional Ownership: The bill would allow high-value “Real-World Assets” (RWAs)—such as commercial real estate, highways, and intellectual property—to be divided into small, tradable digital tokens. This would allow a middle-class investor to own a “piece” of a skyscraper for as little as ₹500.
- Regulatory Sandbox: He urged the creation of a controlled environment for fintech companies to innovate under the supervision of Indian regulators, ensuring that the 12 crore Indian crypto users are protected by law.
- Governance via Blockchain: As a primary reform, he proposed a blockchain-based land registry. Citing international models like Georgia and Dubai, he noted that India’s 48% property dispute rate could be slashed to nearly 1% through tamper-proof digital records.
Conclusion
Raghav Chadha concluded by reminding the House that 70% to 80% of Indian household wealth is currently locked in illiquid assets like gold and real estate. By legalizing tokenization and regulating VDAs, the government could unlock this “dead capital” and provide the middle class with the high-yield investment tools usually reserved for the elite.
He urged the government to view the digital asset sector not as a short-term political tool or a speculative “gambling” arena, but as a long-term nation-building exercise that can secure India’s position as a global leader in the 21st-century financial architecture.
Disclaimer: Crypto products & NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.