India's Crypto Freeze Epidemic: Over 3,200 Accounts Frozen Due to P2P Trading

A bank account in India can be frozen for buying or selling cryptocurrency due to the way funds flow, particularly through peer-to-peer (P2P) trading.

While buying or selling crypto on a registered exchange does not itself trigger a freeze, the way you receive Indian rupees (INR) for a sale, especially through P2P platforms, creates significant risk.

According to data from 2025, over 3,200 accounts were frozen due to P2P-linked fraud, and 90% of these accounts were released within 30 days when traders followed the correct steps.

The freeze is a criminal investigation tool, not a punishment for crypto trading, and it is applied to any account suspected of receiving tainted funds, regardless of the source.