Maharashtra Bill proposes crypto assets as recoverable property under MPID Act

Maharashtra has introduced a bill to amend the Maharashtra Protection of Interest of Depositors (MPID) Act, bringing cryptocurrency-related frauds under the law’s ambit and enabling authorities to attach and recover crypto assets linked to financial crimes, according to an IANS report.

The proposed amendment seeks to classify virtual digital assets (VDAs), including cryptocurrencies, as recoverable property under the MPID framework.

The move is aimed at strengthening investor protection and improving the state’s ability to act against fraudulent deposit schemes involving digital assets.

The bill also proposes measures to reduce delays in trial proceedings and improve the efficiency of recovery mechanisms in financial fraud cases.

Commenting on the development, Edul Patel, Co-founder and CEO of Mudrex, said the amendment marks a significant step toward improving legal clarity around crypto-related enforcement in India.

“The Maharashtra government’s move to include crypto assets in the MPID Act is an important step forward for crypto investor protection. Giving authorities a clear legal mechanism to seize crypto assets linked to fraud and return the proceeds to victims brings much-needed clarity to an area that has long lacked legal certainty,” Patel said.

He added that while the amendment strengthens enforcement capabilities, India still requires a broader digital asset policy framework that addresses operational and regulatory challenges across the ecosystem.

“At the same time, this development also highlights the need for a broader policy framework for digital assets in India. Beyond enforcement, there needs to be clear guidance on issues such as valuation, custody and recovery of crypto assets, along with strong due process safeguards to ensure legitimate crypto businesses and law-abiding users are not inadvertently caught up in enforcement actions. The next step is building a comprehensive and balanced regulatory framework that protects investors while enabling responsible innovation,” he added.