India’s CoinDCX, WazirX take major steps despite lack of regulatory clarity
Popular Indian cryptocurrency exchange, CoinDCX, is looking to close a new financing round of $100-$120 million from investors. This round will reportedly be led by Facebook co-founder Eduardo Saverin’s B Capital Group.
According to reports, its existing investors, Polychain Capital and Coinbase Ventures, will also be participating in the round. This will push its valuation above $1 billion. Also, it will lead the way for CoinDCX to join India’s unicorn club.
This will be a milestone, not only for the exchange, but also for the country’s nascent crypto-industry.
Making the best out of regulatory opaqueness?
Over the past few months, cryptocurrency exchanges in India have been rallying to attain a degree of regulatory clarity. However, the indecisiveness of the government has not yet yielded any positive news yet. Meanwhile, regulators have been cracking down on exchanges and other crypto-businesses. They have also informally asked banks to steer clear of them. This attitude towards cryptocurrencies by payment gateways has led to businesses being impacted gravely.
However, India’s exchanges have learned to forge their own paths by now. When banks were posing problems in processing payments, the exchanges moved to find other permanent payment solutions.
CoinDCX, for instance, despite these obstacles, has been noting steady growth and making its presence felt. Last month, it reported 1.5 million registered users as its user base jumped by 700% since March 2020. In fact, it is also running aggressive advertising campaigns on social media and television.
According to a spokesperson,
“The company might also look to grow inorganically by acquiring smaller exchanges in other markets, even as regulations of such exchanges continue to be fuzzy in India.”
CoinDCX is not the only one
CoinDCX is not the only exchange to jump on the developmental bandwagon. WazirX, another one of India’s prominent exchanges, has announced its plans to move to a decentralized exchange without the need for an intermediary organization to clear transactions.
In fact, according to Founder Nischal Shetty, the DEX is currently being tested and will be launched in August.
“Because a DEX (decentralised exchange) does not own the data, even the authorities can’t really go to the developer of the exchange and say I want the data.”
While the data is available for everyone to see on the blockchain, this step will help the exchange escape the constant loop of “urging the banks to process payments.” This will surely make it popular in India, a country where users have been waiting for a secure yet legal way to trade in crypto.