India's Multilayered Crypto Surveillance System Exposed

The Indian government can track cryptocurrency transactions through multiple layers of surveillance, including public blockchain transparency, KYC identity linkage, TDS data from exchanges, AI-powered ITR matching, and international data-sharing frameworks.

One key layer is the public blockchain, where all Bitcoin, Ethereum, and most other blockchain transactions are permanently public. This allows any government agency, analytics firm, or individual to view the full history of any address.

However, even with self-custody wallets, holding crypto in a personal wallet removes the direct KYC link, but blockchain analytics can still trace activity if any of your addresses interact with KYC exchanges.