Ahmedabad-based mobile bitcoin wallet startup, Zebpay, has raised series A funding of $1 Mn (around INR 6 Cr) from angel investors, in order to promote bitcoins in India.
Arjun Handa, chief managing director of Claris Life Sciences and Amit Jindal, managing director of Jindal Worldwide, invested around $450K (INR 3 Cr) and $150K (INR 1 Cr), respectively. Nagendra Chaudhary, chairman at Jaipur-based Triangle Engineering, also invested $150K (INR 1 Cr) among other investors.
Arjun Handa, Nishith Desai and Amit Jindal are of Zebpay’s advisors.
The startup will use a part of the funding to develop the blockchain technology, which is used to innovate authentication and authorise transactions. Incidentally, in the latest financial stability report, RBI endorsed the potential of ‘blockchain’ as a future mode of technology for financial transactions. The funding will also be used to hire talent and scale its bitcoin services.
Zebpay, a part of Zeb Ventures Pvt Ltd, was registered in Singapore in August 2014. The startup was founded by Mahin Gupta, Sandeep Goenka and Saurabh Agrawal. It had announced the launch of its ‘bitcoin’ mobile wallet in the country in March 2015.
Bitcoin is a form of a virtual currency which operates through a complex chain of encryption independent of a central regulator.
It allows its 25,000+ users to buy & sell bitcoin, to store bitcoin and also use the bitcoins to buy ecommerce site vouchers & recharge mobile airtime across India. It aims to touch $100 Mn turnover and 100,000 users by the end of next year.
Zebpay co-founder Saurabh Aggarwal said, “The environment in India for cryptocurrency is extremely positive and we are planning to utilise the amount to promote bitcoins as a reliable currency and investment option, enlist more e-vouchers on our mobile platform with a target to expand our user base from 25,000 to around 1 lakh within the next one year and ultimately become a bitcoin payment gateway.”
Zebpay has set up a dedicated blockchain lab in order to leverage blockchain power to innovate authentication, authorization and proof of existence. It is in touch with government agencies to offer innovative blockchain solutions which can save millions of dollars in redundant expenses.
However, because there is a chance of crypto-currencies being used as a mode of transaction for illegal activities, it may not be easily accepted by regulators. The virtual currency is yet to get direct support from regulators across the globe, including the Reserve Bank of India.
In its 2015 financial stability report on disruptions in financial technology, RBI identified the importance of ‘private blockchains’, which have the potential of transforming the functioning of back offices of banks and increasing the speed of payments.
The bank said that with its potential to fight counterfeiting, the blockchain is likely to bring about a major transformation in the functioning of financial markets, collateral identification and payments systems.
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