In a landmark order that could influence India's digital asset landscape, the Madras High Court has recognised cryptocurrency as "property" and ruled that an investor's claim against WazirX-the country's largest crypto exchange-was maintainable in India. The case, Rhutikumari vs Zanmai Labs Pvt. Ltd. & Ors. (O.A. No. 194 of 2025), was heard by Justice N. Anand Venkatesh, who delivered his detailed judgment on October 25, 2025.
Background
The dispute began when Chennai-based investor Rhutikumari sought an injunction under Section 9 of the Arbitration and Conciliation Act, 1996, against Zanmai Labs, the operator of WazirX. She claimed that her holdings of 3,532.30 XRP coins, valued at over ₹9.5 lakh, were frozen after a massive cyberattack on WazirX's wallets in July 2024.
WazirX’s parent company, Zettai Pte. Ltd. (Singapore), reported losses exceeding USD 230 million, prompting the platform to freeze user accounts. The company later proposed a "scheme of arrangement" under Singapore law to compensate users, but Rhutikumari challenged the move, arguing that her investments were made and operated from Chennai and thus fell under Indian jurisdiction.
Court's Observations
Justice Venkatesh began with the jurisdictional issue-whether an Indian court could intervene in a case where the seat of arbitration was Singapore, as per WazirX's user agreement. The bench referred to the Supreme Court’s ruling in PASL Wind Solutions Pvt. Ltd. v. GE Power Conversion India Pvt. Ltd., observing that if assets are located in India, Indian courts can issue interim protection orders.
"Prima facie, the asset-crypto currency-was held by the applicant in India by means of the WazirX platform," the judge noted, adding that since the investor was prevented from trading or liquidating her assets, the application under Section 9 was maintainable before the Madras High Court.
The order delved deep into how courts across the globe treat cryptocurrencies. Justice Venkatesh cited precedents from the UK, Singapore, New Zealand, and the US, noting that digital tokens can be identified, transferred, and stored like any other form of property.
He went further, exploring the philosophical and economic essence of crypto.
The term 'currency' is a misnomer, the judge remarked, "since a currency is an official index of value. The value of crypto is what a willing buyer and seller attribute to it."
Drawing on the Internet and Mobile Association of India v. RBI (2020) judgment, the court also emphasised that crypto trading in India was not illegal, only regulated as a ‘virtual digital asset’ under Section 2(47A) of the Income Tax Act.
Crypto as Property: Legal Recognition
In a significant clarification, Justice Venkatesh held that crypto assets meet the legal definition of “property” under Indian constitutional and statutory law. Citing Ahmed G.H. Ariff v. CWT (1969) and Jilubhai Nanbhai Khachar v. State of Gujarat (1995), the court observed:
"Crypto currency is not tangible property nor a currency. However, it is property capable of being enjoyed and possessed (in a beneficial form). It is capable of being held in trust."
The judge also drew parallels with the New Zealand High Court’s ruling in Ruscoe v. Cryptopia Ltd (2020), where cryptocurrencies were treated as trust property, reinforcing that Indian users’ holdings on WazirX deserve similar protection.
Decision
After examining the user agreement and evidence, the court concluded that Rhutikumari's XRP holdings were separate from the assets affected by the cyberattack (which involved ERC-20 tokens). Therefore, her funds could not be subjected to any socialisation of losses under the Singapore restructuring scheme.
The Madras High Court rejected WazirX's contention that it had no control over users’ wallets, holding that Zanmai Labs, as a registered reporting entity in India, was responsible for protecting Indian investors’ holdings.
"To use assets not belonging to Zanmai and to utilise them for covering losses attributable to other users is not something even on the face of it lends itself to reasonable acceptance," the bench stated.
Justice Venkatesh ordered that the injunction sought by the applicant be granted, restraining WazirX and its directors from interfering with the applicant's XRP holdings. The decision reaffirms that digital asset investors in India can seek judicial recourse, even when international arbitration clauses are involved.
Case Title: Rhutikumari vs Zanmai Labs Pvt. Ltd. & Ors.
Case Number: O.A. No. 194 of 2025
Date of Judgment: 25 October 2025
