CoinDCX, an Indian cryptocurrency exchange, has become the country’s first crypto unicorn with a $90m Series C fundraise led by Facebook co-founder Eduardo Saverin’s B Capital.
The round also saw participation from existing investors such as Coinbase Ventures, Polychain Capital, Block.one, Jump Capital, among others, alongside other veteran investors. The Series C, which brings CoinDCX’s total funding to date to $109.4m, comes just eight months after it raised $13.9m in Series B funding.
The newly injected funds will be used predominantly to further the crypto startup’s ambition of ensuring that crypto awareness is spread throughout India. CoinDCX will also use the fund to build next-generation products, by improving its existing product array while strengthening its product team.
In the coming months, CoinDCX will launch the CoinDCX Prime initiative, its latest offering in the HNI and enterprise space, providing legally vetted and safe investments, as well as Cosmex, CoinDCX’s global trading product.
The company said it will also be working on creating a sustainable growth rate by focussing on customer retention campaigns, among other projects.
Additionally, CoinDCX co-founder and CEO Sumit Gupta said that the funds raised will help the firm to bring more Indians to crypto and make crypto a popular investment asset class in India. “We will hire talent across multiple functions, and focus on new business initiatives.
“We will be joining hands with key FinTech players to expand the crypto investor base, set up a R&D facility, strengthen policy conversations through public discourse, work with the government to introduce favourable regulations, and amp up hiring initiatives,” Gupta said.
Founded in 2018, CoinDCX claims to have onboarded more than 3.5 million users. It will now carry forward the vision of making crypto accessible in India and accelerating its efforts towards bringing 50 million Indians into crypto.
Crypto exchanges are gaining traction amid a growing appetite for crypto assets even among retail and casual investors. The likes of WazirC, CoinDCX, CoinSwitch Kuber, Zebpay, Unocoin and others have seen tremendous growth in recent months.
Indeed, the crypto market has been surging globally with the crypto market cap rising 10x, from more than $200bn in March 2020 to $2trn in mid-May this year. In spite of certain apprehensions regarding the volatility of the crypto assets, the effect of the crypto boom over the years is quite apparent, given the rise in transaction volumes across crypto exchanges, globally and in India. For instance, WazirX claims to have achieved 10x growth in just five months, the platform recorded $5.4bn in transaction value in April this year, up from $500m in December 2020.
The funding marks a major achievement in the face of regulatory uncertainty relating to Indian officials’ stance toward cryptocurrencies. For instance, the Enforcement Directorate (ED) issued a show-cause notice to India’s largest crypto exchange in terms of trading volume, WazirX, and its directors Nishchal Shetty and Sameer Hanuman Mhatre, on 10 June, accusing the platform of violating foreign exchange regulations in India with crypto transactions worth ₹2,790 crores.
Furthermore, the Reserve Bank of India (RBI) banned banks from supporting cryptocurrency transactions in April 2018, preventing crypto exchanges, including WazirX and CoinDCX, from temporarily taking rupee deposits from users.
The Supreme Court struck down the RBI’s ban in March 2020, once again boosting the morale of crypto companies.
In February, a bill appeared on the agenda of the budget session of the Parliament in February, which was expected to lay the framework for a central bank digital currency (CBDC) and ban all private cryptocurrencies. However, it was never tabled.
Despite the uncertainty, venture capital interest in crypto and blockchain firms in India has only risen. Data from VCCEdge shows that 13 deals worth more than $176.89m have been completed in 2021 to date, significantly more than the 10 deals worth over $44m in the previous year.
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