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CoinDCX Success Story: How does it want to introduce 50 million Indians to cryptocurrency this year?

CoinDCX Success Story: How does it want to introduce 50 million Indians to cryptocurrency this year?

A sharp rise in internet users has revived the idea of virtual worlds and given rise to brand-new market phenomena known as cryptocurrencies to facilitate financial operations, including buying, selling, and trading. 

Cryptocurrencies are virtual representations of priceless and immaterial items that can be utilised in various applications and networks, such as peer-to-peer networks, online social networks, social games, and virtual worlds.

A virtual currency has been widely used in many different schemes in recent years. Cryptocurrencies are undoubtedly a significant and growing component of the modern digital economy.

One of India’s largest cryptocurrency exchanges, CoinDCX is a well-known cryptocurrency trading platform. The business became India’s first unicorn cryptocurrency firm by raising $90 million on August 10, 2021.

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About CoinDCX 

Users can legally swap several cryptocurrencies on CoinDCX, which bills itself as India’s biggest and safest cryptocurrency exchange platform. Customers can trade their crypto assets in accordance with their needs because it is designed for all sorts of traders, taking into account their trading history, risk tolerance, and frequency.

A business called CoinDCX is developing a network for exchanging cryptocurrencies. The company’s primary goal is to create cross-border financial services that guarantee a steady flow of resources. Thanks to its liquidity, strong wallet, and impregnable protection, trading is rapid, dependable, and simple. With the help of several market-first products made available by CoinDCX, traders may now trade with exchange liquidity.

On April 7, 2021, CoinDCX announced that it had turned three. The exciting path of offering cryptocurrency trading and exchange services to the general public was started by CoinDCX three years ago. Around the same time, the Reserve Bank of India (RBI) announced a banking prohibition for bitcoin and related entities. Additionally, the cryptocurrency market in India was in dire need of a shake-up. It was sufficient to maintain the momentum, and CoinDCX launched with the single objective of “Cryptocurrency Adoption.”

By considering each trader’s trading history, risk tolerance, and frequency of trading, CoinDCX’s services are made to fit all types of traders. The company aims to democratise finance and increase public access to investing.

On January 20, 2021, the company announced that the CoinDCX Go app would go live. CoinDCX Go, a forthcoming Bitcoin application that enables users to legally buy Bitcoin and other popular cryptocurrencies with a single click, is a straightforward, secure, and safe way to invest in cryptocurrencies.

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Industry

The cryptocurrency market, which is expanding at an unstoppable rate worldwide, includes CoinDCX. When we take a look at the entire cryptocurrency market, we can see that it was valued at $1782 billion in 2021. By 2027, the same industry is anticipated to increase at a CAGR of 58.4 per cent and reach $32420 billion. When considering the development of cryptocurrencies in India, it is estimated that the market will reach $241 million by December 2021.

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Founders and Team

Sumit Gupta and Neeraj Khandelwal are the founders of the company.

Sumit Gupta

Co-founder and CEO of CoinDCX, Sumit Gupta, is well-known. Sumit graduated from IIT Bombay with a BTech in Electrical and Electronics and an MTech in Electronics and Signal Processing. Before beginning his career as a software engineer at Sony, he worked as a data research analyst at Columbia Business School. He co-founded ListUp before quitting that company as well and launching CoinDCX; however, he departed the position after a little more than a year. 

Neeraj Khandelwal

Another CoinDCX co-founder who also holds the position of CTO is Neeraj Khandelwal. Khandelwal is also a graduate of IIT Bombay, earning his degree in Electrical Engineering there. Khandelwal is in charge of the items’ technological development.

The entire platform was built from the ground up by the CoinDCX team. The team of more than 100 people includes full-stack developers, blockchain developers, machine learning engineers, app developers, software engineers, and data scientists, giving them the knowledge to implement any cutting-edge logic or functionality in our market. Soon, CoinDCX expects to employ more than 200 people.

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Startup Story

Distributed ledger technology was something Sumit Gupta first became aware of as Bitcoin mining became more and more popular. At that point, the idea of combining several decentralised markets and cryptocurrencies, which act as the marketplace means of exchange, stuck in his head.

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He subsequently got in touch with his buddy Neeraj Khandelwal, with whom he collaborated to close the critical gaps in the market between this new technology and consumers throughout the world. The two concluded that Blockchain traders could monitor hundreds of cryptocurrency trades every second and lacked a centralised trading network. This led to the IIT-Bombay grads launching CoinDCX in April 2018.

The firm claims that since its introduction, it has had a monthly trading volume of $400M and a daily trading volume of over $10M. They started the DCX journey in 2018 with a cryptocurrency exchange after studying the market and the potential of crypto technology.

Business and Revenue Model

According to the founders, the CoinDCX business strategy has created single-point access to trade all cryptocurrency instruments offered in more than 500 marketplaces. It asserts to have created a highly scalable trade machine engine with a one million transaction per second throughput capacity. On the app, a transaction charge applies to every trade or transaction. Like every other cryptocurrency exchange, CoinDCX generates revenue through deposit fees (paid while exchanging currencies), withdrawal fees, trading commissions (0.01 per cent of the total transaction is standard on any exchange), and listing fees.

The trader will profit by lending their holdings with DCXlend, converting INR to Cryptos and vice versa on DCXInsta, and leverage trades with DCXmargin on DCXtrade’s 500+ marketplaces. The company’s goal is to become the top cryptocurrency exchange in the world. Users get access to liquidity from the top cryptocurrency exchanges in the world thanks to the company’s innovative liquidity aggregation model.

Growth

Many people refer to CoinDCX as the first crypto unicorn in India. The company was founded in 2018 and offers simple buying, selling, and investing options for all cryptocurrency-based products. This BitGo-insured, ISO-certified cryptocurrency platform offers a variety of goods, including CoinDCX, CoinDCX Pro, DCX Learn, Cosmex, and more. It is the only cryptocurrency firm in India to have successfully completed three CoinDCX investment rounds in under a year.

Between October and November 2021 alone, CoinDCX’s installed user base increased by 45.78 per cent. The unique concepts around which CoinDCX was built, its capacity to overcome obstacles, the funding rounds it has experienced, and the creative and fascinating marketing tactics that CoinDCX employs all play a significant role in the company’s potential to expand. 

Some growth highlights of the company are:

  • CoinDCX became the first cryptocurrency unicorn in India, valued at $1.1 billion as of August 10, 2021, with the help of the most recent funding round, in which Eduardo Saverin, the former co-founder of Facebook, and his B Capital Group participated along with a number of the company’s current investors, including Coinbase Ventures, Polychain Capital, Block.one, and others. In April 2022, CoinDCX had a value of more than $2.15 billion.
  • It has grown its userbase from 150K to 400K in just 15 months
  • The daily trading volume of CoinDCX is $100+ mn, and it already crossed $10 billion in trading volume in February 2021
  • It has witnessed a 4X growth Q-o-Q in daily active users
  • It has listed 500+ coins and 1000+ trading pairs

CoinDCX Ventures

On May 10, 2022, CoinDCX formed CoinDCX Ventures to establish its own startup investing division. The company’s Ventures, the venture capital division of the unicorn Indian cryptocurrency exchange, will assist the business in investing in early- and late-stage cryptocurrency and blockchain firms.

An alumnus of Harvard Business School, Rohit Jain has been chosen by the business to serve as Senior Vice President and Head of Ventures and Investments for CoinDCX Ventures, which aims to support India’s digital asset ecosystem and boost its economy. CoinDCX Ventures is nothing less than a “huge milestone,” according to Sumit Gupta, co-founder and CEO of CoinDCX, and the cryptocurrency exchange intends to spend close to Rs 100 crores on CoinDCX Ventures over the course of the next 12 months.

CoinDCX “Earn” Crypto Yield Initiative

The beginning of CoinDCX’s new project has been set for May 26, 2022. The cryptocurrency asset owners can earn income on their holdings thanks to the company’s “Earn” initiative.

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The platform will distribute the assets under “Earn” to generate profits across various yield-generating options like lending, margin trading, and staking. This new possibility to generate revenue promises no lock-in periods and withdrawals at any time, giving clients complete flexibility and control over their cryptocurrency investments. The tenor, however, has to be for seven days.

The global pandemic may have prompted more investors to consider these new liquidation options, which led to increased interest in digital assets. According to analysts, this trend is anticipated to grow rapidly as institutional and individual investors use these new asset classes to diversify their portfolios.

Retail investors between the ages of 25 and 40 spend millions of dollars each day trading cryptocurrencies in India, which is considered to be an emerging market. The exchange reports a 3X rise in total volume traded and a 4X increase in daily active users during the April to June 2020 quarter.

Funding and Investors

Throughout its eight investment rounds, CoinDCX has raised over $244 million. On April 19, 2022, the company received the final (Series D) round of funding, which enabled them to raise $135 million. This investment round was organised by Pantera Capital and Steadview Capital, helping the crypto unicorn increase its estimated value to $2.15 billion. On August 10, 2021, the company raised $90 million thanks to the previous round of fundraising, making it a unicorn with a valuation of $1.1 billion.

CoinDCX has received funding from many well-known venture capital firms, including Steadview Capital, Pantera Capital, B Capital Group, Polychain Capital, Bain Capital Ventures, and others. As a result, CoinDCX has become the first crypto unicorn in India. But until this point, little was known about CoinDCX’s shareholding structure. 

The company’s ownership structure reveals that Polychain Ventures holds the largest holdings in the business, with co-founders Neeraj Khandelwal and Sumit Gupta, each owning 14.36 per cent. According to reports, the co-founders are worth a total of around $590 million.  

Partnerships and Campaigns

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  • CoinDCX Makes Amitabh Bachchan it’s Brand Ambassador

There have been many agreements with Bollywood actors and others at CoinDCX. The company didn’t have any brand advocates until it teamed with renowned actor Amitabh Bachchan, who, according to reports from October 4, 2021, became the brand’s first brand ambassador. With this partnership, the company hopes to increase public awareness of cryptocurrencies and promote them as a new type of asset. Bachchan is also considered to be the new face of CoinDCX’s most recent advertising campaign.

Bachchan’s personality aligns with the principles of the brand, claims CoinDCX. Amitabh Bachchan is the epitome of wisdom and leads his league in all he does, which would assist the business gain greater respectability. The experienced actor has also successfully launched his own NFT (Non-fungible token) and has experience investing in cryptocurrencies, giving him a wealth of expertise in the industry. “His expertise will increase credibility and confidence among new users. We are confident that his affiliation with CoinDCX will raise awareness of the cryptocurrency industry and create a strong brand association for us,” mentioned Sumit Gupta, Co-founder and CEO of the brand.

As of October 15, 2021, CoinDCX has not yet started its advertising campaign with Amitabh Bachchan. Due to the uncertainty surrounding the law and policy environment, the corporation apparently decided to partner with the venerable actor for its advertising campaigns. On the other hand, Amitabh recently revealed in a blog post that he would be rethinking the advertising campaign he had agreed to with the well-known cryptocurrency trader. On the same blog, he had also announced that he would revoke his endorsement of the Kamala Pasand pan masala brand.

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  • CoinDCX Ropes in Ayushmann Khurana

Ayushmann Khurana, a renowned actor, will appear in the crypto unicorn’s next “Future Yahi Hain” ad on October 18, 2021. This CoinDCX commercial aims to allay Indian audiences’ worries about cryptocurrency investments.

  • #BitcoinLiyaKya Campaign

The integration of cryptocurrencies like bitcoin is the subject of a lighthearted marketing campaign by CoinDCX called #BitcoinLiyaKya. Through organisations like CoinDCX, this effort hopes to increase the number of bitcoin users.

  • HAPPY DAY REWARDS Campaign

CoinDCX started the “HAPPY DAY REWARDS” campaign to support its national cryptocurrency awareness drive and position cryptocurrency as a dominant asset class.

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Numerous qualified new customers had the chance to win up to Rs 1 lakh ($15,000) worth of Bitcoin (BTC) each day during the campaign, which ran from September 19, 2021, to October 15, 2021.

Some other partnerships that the company saw are:

  • Other collaborations that CoinDCX saw include:
  • On March 8, 2022, the unicorn cryptocurrency startup collaborated with BITS Pilani to support student research, development, and innovation in India’s cryptocurrency field.
  • On February 19, 2022, CoinDCX and Solidus Labs entered a partnership. This partnership aims to strengthen anti-money laundering defences.
  • Collaboration with Onfido: CoinDCX collaborated with Onfido. To determine whether the user identities on the users’ identity documents are genuine, CoinDCX teamed with the UK-based organisation, which has its headquarters in London and is recognised as a global leader in AI for identity verification and authentication.
  • Collaboration with BitGo – In May 2020, CoinDCX joined forces with BitGo to protect the funds of Indian cryptocurrency traders.

Competitors

The top Competitors of CoinDCX are as follows:

  • WazirX
  • CoinSwitch Kuber
  • Zebpay
  • Unocoin
  • UPHOLD
  • Binance
  • Coinbase
  • Poloniex
  • LocalBitcoins
  • HitBTC
  • Kucoin
  • C-Cex
  • Bitso

Challenges Faced

The same year CoinDCX was introduced, the RBI declared a banking ban on cryptocurrency transactions. This resulted in the closure of cryptocurrency companies in several regions of India; however, CoinDCX was one of the unique players who challenged this restriction. In March 2020, the Supreme Court of India finally overturned this decision. By removing the embargo, CoinDCX could increase the number of investors on its exchange from 150K to 400K.

Indian cryptocurrency exchanges WazirX and CoinDCX witnessed hour-long disruptions as Bitcoin, the most popular cryptocurrency in the world, plunged sharply to a multi-month low. On May 19, 2021, Bitcoin’s price dropped by 30% in a matter of hours to $31,000. When the price of cryptocurrencies dropped, many investors wanted to sell their holdings to avoid suffering significant losses. Still, they could not do so because WazirX and CoinDCX’s servers crashed, blocking those deals.

Other investors tried to buy cryptocurrencies at a discount, but they could not do so, losing out on a critical time before the price of Bitcoin rose to $40,000. Several investors requested withdrawals after converting their cryptocurrencies to Indian rupees. Still, they said the money had only been taken out of their crypto wallets and had not yet shown in their bank accounts.

Numerous Indian banks have stopped providing services to Indian cryptocurrency startups due to an informal recommendation from the Reserve Bank of India (RBI). This is still the situation even if the Supreme Court ruled in March 2020 to invalidate the RBI’s 2018 circular that forbade banks from providing services to cryptocurrency exchanges.

One of the few remaining sizable lenders to offer services to crypto firms, ICICI Bank, has halted the current accounts of those companies. The private sector lender reportedly instructed payment gateways for businesses purchasing or selling bitcoins to disable their net banking services.

ED questioned CoinDCX in Relation to FEMA

To determine if the Indian cryptocurrency enterprises are involved in foreign currency offences, the Enforcement Directorate (ED) has been working on an ongoing Foreign Exchange Management Act (FEMA) investigation. ED has also notified CoinSwitch Kuber in relation to the same. The creator of CoinDCX, Sumit Gupta, has already been questioned by the ED at its Bengaluru headquarters. According to the allegations, his words were also recorded on video.

Future plans

  • This year, the country of India hopes to attract 50 million new bitcoin users.
  • Targets new crypto fans, particularly millennials and Generation Z, for broad adoption.
  • Works to raise awareness of cryptocurrencies;
  • It aims to expand the company’s current line of products.

In yet another effort to hasten the widespread adoption of cryptocurrencies, the business spent $1.3 million on TryCrypto, an initiative that aims to increase consumer access to blockchain and cryptocurrencies.

Edited by Prakriti Arora

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