Engaging in investments requires careful consideration, but diversifying your portfolio can help simplify the process. However, investing in cryptocurrencies, like Bitcoins, is a different story. It’s important to note that investing in cryptocurrencies, such as Bitcoin, is currently considered a gray area. Unlike mutual funds, which invest in recognised and regulated assets, cryptocurrencies do not meet these basic requirements.
Talking about India mutual funds investing in Bitcoins, Akshat Shrivastava, founder of Wisdom Hatch, wrote on X, there are no mutual funds in India that directly or indirectly invest in Bitcoin. However, the returns on Bitcoin have been significant, with a 27% increase in the past 6 months, a 50% increase in the past year, a 900% increase in the past 5 years, and an impressive 11,400% increase in the past 10 years.
On the other hand, prominent US mutual funds and asset managers such as BlackRock (iShares Bitcoin Trust), Fidelity, VanEck, and Calamos have introduced Bitcoin ETFs or related Bitcoin-linked funds in 2024 and 2025.
“There are currently 0 mutual funds in India that invest in Bitcoin, either directly or indirectly. Meanwhile:
(1) BTC returns:-
6 month= 27%
1 year= 50%
5 year= 900%
And, 10 years= 11,400%
2) US Mutual Funds (or asset managers) like BlackRock (iShares Bitcoin Trust), Fidelity, VanEck, and Calamos have launched Bitcoin ETFs or structured Bitcoin-linked funds in 2024 and 2025.
Some of these firms are the biggest in the world.
3) Wealth Funds in the Middle East, Norwegian wealth funds and even governments are buying BTC. Either Indian MF are extremely smart or extremely stupid. Next 10 years will prove which way this story is heading,” Shrivastava wrote.
Investing in Bitcoins in India
The Securities and Exchange Board of India (SEBI) does not allow mutual funds to invest in cryptocurrencies directly or via foreign funds with crypto exposure. This stance aligns with the Reserve Bank of India’s cautious view, which has called crypto a “serious concern” for macroeconomic stability and financial integrity.
Bitcoin is not considered legal tender in India at this time. However, there are currently no laws prohibiting the use of Bitcoin or other Virtual Digital Assets (VDAs). This means that individuals are permitted to engage in trading Bitcoin within the country. Crypto exchanges can be utilized to sell Bitcoin for cash.
It is important to note that Bitcoin, as a form of payment, has not been officially authorized or regulated by any central authority in India. As such, there are no established rules, regulations, or guidelines in place to address potential disputes that may arise from Bitcoin transactions. Consequently, engaging in Bitcoin transactions entails inherent risks that individuals should be aware of.
No legal clarity, no crypto ETFs
Unlike the US, where the SEC approved spot Bitcoin ETFs in early 2024, India hasn’t allowed any crypto-backed investment vehicle. Even top AMCs like ICICI Prudential and Nippon Life India have publicly said they are staying away until there is regulatory clarity. They are leading asset management firms in India that specialise in traditional investment avenues such as stocks, bonds, and mutual funds.
Risk-aversion by design
Mutual funds serve a largely retail-dominated investor base, many of whom rely on these funds for stable, long-term savings like retirement and children’s education. Introducing a volatile asset like Bitcoin into the mix could clash with these expectations.
Tax ambiguity
Cryptocurrencies in India is taxed at 30% on gains (plus 1% TDS on transactions), but mutual funds come with indexation, LTCG, and STCG tax regimes. Mixing the two creates structural and compliance complications.
Shrivastava noted that if Bitcoin proves to be digital gold, Indian MFs will be seen as having missed a trillion-dollar wealth creation opportunity. If it crashes or is banned, their conservatism will be hailed as prudence.
