CoinSwitch and Trilegal Team Up To Address India's VDA Policy Deadlock

CoinSwitch, India's largest crypto trading platform, has published a comprehensive research compendium titled "Block by Block" aimed at providing a data-driven policy roadmap for the country's virtual digital asset (VDA) regulation. The report was produced in collaboration with leading law firm Trilegal and the National University of Juridical Sciences (NUJS) Law Review in Kolkata.

Ashish Singhal, Co-Founder of CoinSwitch, announced the publication on February 17, 2026, noting that the initiative involved inviting law and public policy students from across India to submit research papers on crypto regulatory pathways. A jury selected the top five proposals, which form the core of the compendium. The collaboration also included Jaideep Reddy, Partner at Trilegal, and Dr. Shameek Sen, Professor at NUJS.

The "Block by Block" report moves beyond general advocacy to offer granular solutions for five key pain points in the Indian crypto ecosystem: taxation, classification, compliance, consumer protection, and innovation. It proposes moving away from a "one-size-fits-all" approach, advocating instead for a functional classification system where stablecoins, NFTs, and utility tokens are governed by different rules based on their risk profile.

Addressing the Offshore Migration Crisis

One of the report's primary focuses is tackling the exodus of Indian crypto users to offshore exchanges due to the domestic 1% TDS and 30% flat tax. The compendium proposes a "Compliance-First" tax model that would allow offsetting of losses and reduce TDS to a manageable level, aiming to bring users back to regulated domestic platforms where PMLA and KYC norms are strictly enforced.

The report also recommends introducing regulatory sandboxes—a safe harbor for developers to test DeFi protocols and tokenization models—rather than adopting a "regulate first, ask questions later" approach. This would allow regulators like the RBI and SEBI to observe market behavior before crafting durable legislation.

Additionally, the compendium advocates for mandatory Proof of Reserves and standardized risk disclosures for exchanges to protect retail investors, citing the need to prevent incidents similar to the FTX collapse on Indian soil. By providing a peer-reviewed, plug-and-play policy framework, CoinSwitch aims to help India transition from a "market of participants" into a "hub of policy" within the G20 crypto roadmap.