Cryptocurrency may not be a favourite of regulators in India, but it is clearly a hot currency for the startups, users as well as investors. And Bengaluru-based CoinSwitch reflects this uptrend.
Interestingly, while other companies may have shrunk their operations due to the pandemic or have had to pause the business, CoinSwitch Kuber, a crypto trading platform for India, was launched right in the midst the coronavirus outbreak. The founders say that they saw a spike in growth because traditional markets have been in turmoil due to COVID-19.
“We have seen a large number of investors moving to crypto and have seen a huge surge of users on the platform. We have seen over 500 percent growth month-on-month on CoinSwitch Kuber. Today, it is doing over $1 million GMV per day, and reaching 250,000 users with investments to the tune of Rs 300 crore within just 100 days of the launch. We are seeing a lot of first-time users coming to CoinSwitch Kuber and investing in crypto,” Ashish Singhal, CEO and Co-founder of CoinSwitch, tells YourStory.
Ashish claims that CoinSwitch Kuber surpassed every Indian exchange in trading volumes within a month and is witnessing a six-fold growth on a month-on-month basis. The founder also reveals that as opposed to the common assumption that cryptocurrency is a metro phenomenon, as much as 60 percent of the startup’s user base comes from Tier II and III cities. This signals the country’s growing appetite for crypto investments.
Started in 2017 by Ashish Singhal, Govind Soni (CTO), and Vimal Sagar (COO) as a global aggregator of cryptocurrency exchanges, the startup offers over 300 coins and 45,000 currency pairs. It launched its India-exclusive INR-crypto on-ramp platform, CoinSwitch Kuber, in June this year. It supports hundreds of cryptocurrencies for users to buy and sell using Indian rupees.
From hackers to founders
Govind, Vimal and Ashish, all in their early 30s now, have known each other for the last 13 years. They became friends while working in companies like Amazon, Microsoft, and Zynga. They were also tech wizards, who as a team, participated in hackathons. The trio won almost every major hackathon in India, including those hosted by Sequoia, Google, Amazon, and LinkedIn. Interestingly, the idea for CoinSwitch started with a hack which the trio later made public.
“While trading in crypto ourselves, we realised that the price of crypto varies across exchanges based on its supply and demand. In a bid to get better returns from the market, choosing the right exchange plays a very important role. We built an aggregator of these exchanges which gave us real-time data as to which is the best exchange to trade at any given point to get the maximum return,” tells Ashish.
He added that the friends-turned-co-founders made the product public in 2017 and realised that this was a pain point for a majority of crypto traders. The numbers speak for themselves.
“Within a month of the launch, we were processing over $1 million in trades and subsequently got funded by Sequoia Capital. Today, we are doing more than $300 million in trade every month,” tells Ashish.
Speaking of the Indian market, he says, “We realised that 90 percent of Indian cryptocurrency buyers are retail investors. Till now, nobody was going after that consumer set. We launched CoinSwitch Kuber in June 2020, with the sole aim of simplifying cryptocurrency investments for retail users in India.”
Grey areas and challenges
In India cryptocurrency is a grey area. Even though the Supreme Court lifted the ban on banking in March, the India government said in September that it was planning to bring a law to ban trade in cryptocurrency. On this, Ashish says unless the government does not give any negative directive, there is nothing to worry about.
“That said, we will keep innovating and working towards making crypto investments safe and simple,” he quips.
Market experts say that the Indian government is expected to bring a legal framework instead of going with a ban.
Speaking about challenges, Ashish says the only challenge for the company is educating users about cryptocurrencies and the ecosystem in India. “I feel regulating the market can set this on the right course,” he says.
‘Swiggy of cryptocurrency’
CoinSwitch competes with players such as CoinDcx, ZebPay, WazirX, and Unocoin. However, according to Ashish, most crypto exchanges in India are designed to cater to traders with pro features.
“Over 90 percent of crypto buyers in India are not traders. They just need a simple way to buy, sell and hold cryptocurrencies at the best rate – and that is what we offer,” he explains.
“Cryptocurrencies have been gathering a lot of steam and are being seen as an alternate asset class. CoinSwitch Kuber is an exclusive platform to simplify crypto investments for retail users. We want to make crypto investing as easy as ordering food on Swiggy,” Ashish quips.
Bengaluru-based BitCipher Labs LLP, the parent company of CoinSwitch, had raised an undisclosed amount from Sequoia Capital in seed investment within 15 days of company formation. “And in the next few months of our operation at that time, we became profitable and did not require additional funding for our growth,” tells Ashish.
Starting with three people, the startup has now expanded to more than 50 employees who take care of $200-300 million GMV per month on the platform.
Growth and future plans
With 300,000 users already on board, CoinSwitch Kuber has seen rapid growth which is multiplying each month. The startup now expects the platform to onboard over 1.5 million users by the end of FY21, and hopes to become the most trusted company for crypto investing in India.
“Additionally, for FY 21, we want to double down on our efforts to educate the Indian masses about cryptocurrencies and work with policymakers in creating a regulatory framework,” says Ashish.
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