This ruling clarifies that cryptocurrencies are governed by Section 2(47A) of the Income Tax Act and are not considered speculative transactions, providing much-needed legal clarity.

The decision has significant implications for taxation, inheritance, insolvency, and contractual matters involving digital assets in India, marking a major step forward in legal recognition.

The case originated when Rhutikumari sought to prevent Zanmai Labs and its directors from interfering with her XRP holdings on the WazirX platform, which had been frozen following a cyberattack.

This landmark ruling is expected to influence India's economic growth, regulatory development, financial inclusion, and its strategic positioning in the international crypto market amid evolving global regulations.

WazirX argued that it does not own users' wallets and that the halt in withdrawals was due to a major hack, with a court-approved restructuring scheme in Singapore providing for user compensation.

The court granted an interim injunction to protect the plaintiff’s crypto holdings from interference or reallocation by Zanmai Labs during the legal proceedings.

The Madras High Court rejected WazirX’s jurisdictional claims, establishing a territorial connection since the plaintiff’s funds were transferred within India and accessed from Chennai.

The judgment was driven by the lack of clear crypto regulations, international precedents recognizing crypto as property, investor protection concerns, and the growth of India’s crypto market.

This legal recognition is poised to boost market growth, enhance investor confidence, facilitate tax collection, and attract foreign crypto firms, strengthening India’s position in the global digital economy.

The case involved a woman whose XRP holdings were frozen after a cyberattack, and the court recognized her assets as her property, preventing interference during arbitration.

The ruling aligns with India’s evolving regulatory environment, including potential tax frameworks and oversight by the Reserve Bank of India, supporting its ambitions to be a progressive player in the global crypto ecosystem.

The court referenced international rulings from countries like New Zealand, the UK, Singapore, and the US, which recognize cryptocurrencies as intangible property or commodities, reinforcing its decision.

The Madras High Court has declared cryptocurrencies as 'property' under Indian law, affirming their status as virtual digital assets that can be owned, enjoyed, and held in trust.