Indian cryptocurrency exchange CoinSwitch Kuber claims to have become the largest in the country in terms of number of users. Sharan Nair, chief business officer at CoinSwitch, tweeted last week: “With over 10+ million users, we at @CoinSwitchKuber aim to continue making #crypto a household name and work alongside regulators and policymakers to bring legitimacy to the industry.”
While the exchange launched in 2017 for a global user base, CoinSwitch began operations in India amid the pandemic last year. The exchange was launched with the stated goal of making crypto trading as simple and easy as using an online food delivery app like Swiggy or Zomato.
Based in Bengaluru — informally known as the Silicon Valley of India — the exchange has amassed over 10 million users while its competitors are playing catch-up. As of August, Binance-owned crypto exchange WazirX had more than 7.3 million users while CoinDCX, India’s first crypto unicorn, had over 3.5 million users.
“CoinSwitch Kuber has reached the milestone [of 10 million users] in just 15 months since starting operations in India in June 2020, a testament to the simplicity and convenience the platform provides its users,” the exchange said in an Economic Times report.
Around 7 million of the 10 million users are active with a monthly transaction volume of around US$2 billion, the ET reported. CoinSwitch is backed by marquee investors such as Tiger Global Management, Sequoia Capital India and Ribbit Capital.
The startup has raised around US$40 million so far, completing its latest funding round led by Tiger Global which valued the firm at US$500 million in April this year. CoinSwitch is currently in talks to raise a new round of capital at a valuation of US$2 billion, a report by TechCrunch says. If the deal goes through, CoinSwitch stands to become India’s second crypto unicorn after CoinDCX.
The company aims to accelerate its growth by continuing to provide simple and secure crypto trading experience coupled with the most favorable rates, the ET report said. Although reaching 10 million customers is a big win for CoinSwitch, it represents less than 1% of India’s population of 1.3 billion.
CoinSwitch’s user base growth may have outstripped its peers, but most exchanges in India have reported robust growth in user numbers since the pandemic started. WazirX, for instance, reported in August its user signups in 2021 have increased by 2,375% from large cities while signups from smaller cities, classified as Tier II and Tier III cities in India, jumped by 2,648%. WazirX also noted an increase in user signups by women from smaller cities, who represented 65% of total signups by women from India.
As with WazirX, the majority of users on CoinSwitch also hail from small cities and towns in India. According to a Livemint report, around 55% of its users are from Tier II and Tier III cities, although the monthly average investment size is higher for users in larger Tier I cities.
CoinSwitch users from Tier I cities shell out approximately US$157 every month, while users from Tier II and Tier III cities have an average monthly ticket size of around US$90 and US$47.50 respectively, the Livemint report said.
Singapore-headquartered crypto exchange Zebpay, which operates in India and also offers a fixed return crypto lending product, reported a 443.65% growth in registered users in 2020. These user numbers indicate a sharp rise in interest in the crypto space in India, especially among GenZ and millennials. Around three quarters of CoinSwitch customers are aged between 18 and 35, with the average age hovering around 24 years, the Livemint report noted.
India’s crypto space is clouded by regulatory uncertainty, but that is far from dampening the enthusiasm of crypto businesses as indicated by U.S.-based crypto exchange CrossTower’s entry into India last week. Various government officials have provided conflicting reports about India’s crypto regulation plans, swinging between a complete ban to a softer stance. The latest update suggests the government is looking to treat and regulate cryptocurrencies as commodities, while exchanges continue to face banking challenges. India’s crypto bill draft, which has yet to be released to the public, is currently awaiting a nod from the Union Cabinet before it can be introduced in parliament. If the cabinet approval is received by November, the bill could be introduced in the winter session of parliament.