CoinSwitch Founders To Launch Investment Platform By June

Days after CoinSwitch became the first Indian crypto platform to hit 20 Mn registered users on its app, the founders have revealed plans to launch an investment platform for retail investors by June 2024.

Speaking with Inc42, cofounder Ashish Singhal said, “Currently, we are doing beta tests of these products and hope to launch these products in the next quarter.” 

“…we will be able to showcase what we have learned in the last few years, solving for the stock market, mutual fund, or any other product that we will be launching next quarter,” Singhal added.

Founded by crypto traders and ethical hackers Ashish Singhal, Govind Soni and Vimal Sagar Tiwari in 2017, CoinSwitch is backed by a slew of reputed investment firms, including Andreessen Horowitz, Tiger Global, Sequoia Capital, Ribbit Capital, Paradigm and Coinbase Ventures. The company has raised more than $300 Mn since its inception. It was valued at $1.9 Bn+ in its last round in 2021. 

The crypto unicorn unveiled its umbrella brand, PeepalCo, in December last year to consolidate all its business verticals to foray into the wealthtech space. 

Highlighting the strategic significance of PeepalCo, Singhal said that the move will help them transition from a single-product company to a multi-product company. 

PeepalCo Includes:

• CoinSwitch and CoinSwitch PRO
• A soon-to-be-launched platform featuring new investment classes — mutual funds, equities,
• A wealth-management division catering to High Net Worth Individuals (HNIs)

Thus, whether it’s CoinSwitch, CoinSwitch Pro or its foray into the Indian equities, mutual funds and HNI wealth management space – all verticals will be housed under one corporate brand — PeepalCo.

According to Singhal, the new umbrella structure has been designed to unlock the full potential of the organisation and align the company’s resources more effectively.

At the group level (PeepalCo), Singhal has assumed the role of Group CEO, while Tiwari and Govind have assumed the roles of Group COO and Group CTO, respectively. Each business segment will be led by independent business heads.

Besides, CoinSwitch Ventures, currently overseen by the PeepalCo Group leadership, will be merged with PeepalCo later. However, this will not have any major impact on CoinSwitch’s core functionality and offerings, Singhal added.

Taking On The Existing Players & Sailing The Regulatory Maze

In the Indian market, whether it’s investments in equities, mutual funds or other asset classes, there’s already a plethora of players, which range from established legacy institutions like banking groups to rapidly emerging tech companies like PhonePe and Paytm Money.

In such a crowded landscape, how does PeepalCo plan to compete with well-funded and rapidly growing tech players?

Singhal illustrated their approach with a crypto analogy. He highlighted that neither they were early entrants in the crypto space nor well-funded, and despite this, they became one of the largest crypto players in the country.

“Crypto was our initial focus because we had years of experience in the field and had already developed solutions tailored for Indian retail users, making their experience simple and accessible. While addressing crypto, we expanded our scope to include other asset classes. We observed that existing platforms were user-friendly, yet a significant portion of the population, less than 3%, invested in fixed deposits. Users lacked guidance on when to enter or exit investments, and existing platforms didn’t address this effectively,” Singhal explained.

He emphasised that the decision-making processes in the industry are currently flawed and need to be addressed, and this is what PeepalCo Group aims to resolve.

Entering the mainstream investment and wealth management market requires PeepalCo to obtain SEBI’s licence. However, it’s still uncertain whether the company has applied for a new licence or plans to acquire a company in the segment to pursue its wealthtech ambitions.

Regarding concerns about regulatory issues, particularly given past skepticism from regulators about companies associated with crypto, Singhal explained, “We are adopting a strategy similar to other players in the industry — creating independent companies and operating them separately from each other. Just as PhonePe and Paytm have done, we are establishing separate entities with dedicated teams to manage different asset classes and apps, thereby avoiding any overlap.”

Meanwhile, the strategic shift of the founders towards the wealthtech space has come at a time when the future of crypto in India seems bleak. For one, the Union finance ministry isn’t too keen on promoting crypto in the country, and the message is loud and clear in the form of a 30% crypto tax and a 1% TDS on transactions above a certain threshold. 

Amid adverse regulatory sentiments, CoinSwitch’s expansion and restructuring is seen as a prudent move by many. However, the company’s decision to step into uncharted territories to take on behemoths like Zerodha and Groww may take some time to yield results.