Maharashtra has become the first Indian state to include cryptocurrencies and other virtual digital assets (VDAs) under a depositor protection law. The government has amended the Maharashtra Protection of Interests of Depositors (MPID) Act, letting authorities seize, value, and sell crypto assets tied to financial fraud so victims can be compensated.
The amendment also speeds up court proceedings, requires a 50% pre-deposit for appeals, and plans to set up financial monitoring units in every district to spot suspicious investment schemes early. This amendment changes how digital assets are handled in fraud cases.
Previously, crypto linked to scams was often frozen for years during court cases, leaving victims waiting and assets exposed to price swings. Now, authorities can value cryptocurrencies at current market rates and convert them to cash for distribution to affected investors.
The MPID Act was created in 1999 to protect depositors from fraudulent financial schemes promising high returns. It already let authorities seize properties, bank accounts, and other assets, but did not mention cryptocurrencies since they were not common at the time. The new amendment now clearly includes crypto assets as property that can be recovered.
The amendment also requires anyone appealing an order under the Act to pay a 50% pre-deposit. Minister of State for Home Yogesh Kadam said this rule is meant to reduce unnecessary lawsuits and help victims get their money back faster. Court cases will also move more quickly, with adjournments usually limited to two unless there are special reasons for more delays.
The government plans to set up financial monitoring units in every district of Maharashtra. These teams will watch for suspicious financial groups, especially those promising unrealistic or guaranteed returns, and try to catch fraud early. This step aims to protect investors, especially in semi-urban and rural areas where people may know less about cryptocurrencies and cyber fraud.
The timing of this amendment is important. Maharashtra has seen more crypto-related fraud cases than any other Indian state in recent years. Government data shared in the Assembly shows thousands of cyber financial fraud cases across the state, with Mumbai alone losing over ₹1,000 crore in the past 18 months.
The legislation also arrives while India continues to operate without a dedicated cryptocurrency law. Although the central government has introduced taxation rules for VDAs, brought crypto businesses under anti-money laundering regulations and tightened reporting requirements, there is still no comprehensive legal framework governing digital assets. Maharashtra’s move therefore represents one of the country’s most concrete legal steps towards enabling recovery of crypto-linked assets for investors affected by financial fraud.
However, the amendment has faced criticism. Opposition leaders worry that the 50% pre-deposit rule might make it harder for real victims to get justice and have asked for more special courts to handle financial fraud cases faster. Others want stricter checks on cooperative institutions and tougher action against cybercrime groups that use fake social media accounts to attract investors.
Maharashtra’s move could set an example for other states as India discusses how to regulate crypto. By letting authorities recover and sell digital assets, the state has taken a key step to better protect investors in the fast-changing world of digital finance.
फसवणूक झालेल्या ठेवीदारांची रक्कम आता जलद गतीने परत मिळणार..
एमपीआयडी (MPID) कायद्यातील सुधारणा विधेयक विधानसभेत मंजूर झाले..याबद्दल मी माननीय मुख्यमंत्री @Dev_Fadnavis जी आणि उपमुख्यमंत्री @mieknathshinde साहेब यांचे मनःपूर्वक आभार मानतो..
या महत्त्वपूर्ण निर्णयामुळे… pic.twitter.com/w8dzo90hI3
— Yogesh Ramdas Kadam (@iYogeshRKadam) July 1, 2026
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