As global investors start to take note of the Indian Web3 ecosystem, Bengaluru-based cryptocurrency exchange, CoinSwitch Kuber, is also working on setting up its venture arm to invest in the space.
While the venture arm will start with just investments, Ashish Singhal, Founder and CEO, CoinSwitch Kuber, told BusinessLine the idea is to help its over 17 million registered users see the possibilities of metaverse. “It is also our way of introducing users to this new world,” he said.
Singhal did not share more details on the fund size and timeline for investments as the initiative is still in a nascent phase. “We are actively looking at companies, participating, and helping them. They are also helping us because we can’t do all the innovation ... We don’t want upcoming companies in the space to solve the same problems and probably new ones. So that’s why we are trying to collaborate,” he said.
Beyond the commitment to invest in Web3 start-ups, Coinswitch Kuber has also been actively partnering and sponsoring initiatives in the ecosystem. For instance, the exchange recently sponsored the metaverse holi, hosted by YUG Metaverse, and also the first metaverse wedding on YUG’s platform.
“What India missed out on during internet 1.0, building protocols (TCP/IP, HTTP), browsers, or any other internet infrastructure — we have that chance now. We have over four million developers and some of the amazing talent to build these infrastructure for Web3. Tomorrow’s Amazon will come from India and probably be built on blockchain for the world to use. We want to be the promoters of that, which is why we sponsor a lot of these events in metaverse,” said Singhal.
A crypto exchange like CoinSwitch is the bridge between Web2 and Web3 companies, he added.
Singhal said the company has been working on educating investors on the new rules, as he believes a lot of them are yet to come to terms with it. The company is said to be investing a significant part of its budget on the same. In terms of manpower, 40 per cent of CoinSwitch Kuber team is geared towards it.
“We are doing a lot of educational activities related to taxation such as YouTube lives, AMAs. We are glued to the TV when crypto news comes along, but that is not true for a lot of people. So, we are working on educating users about what is happening, and dumb it to a level where they can understand the nuances of offsetting, among other things,” he said.
TDS, detrimental to sector
Ever since the crypto tax was introduced, CoinSwitch, along with many others in the industry, has held the stance that taxing is good as it brings legitimacy to cryptocurrency. Noting that the intention is right, Singhal, however termed the 1 per cent TDS detrimental to the sector, and believes it will push users away from Indian and KYC exchanges to global ones.
Additionally, not allowing crypto investors to offset gains from one cryptocurrency against losses from another will remove the incentive for anyone to invest in new projects. “So, all the investment will go to, say Bitcoin or Ethereum only. This will hurt new projects from India, who might not get as much investments now. The last concern is that 30 per cent tax is a bit higher; making it more slab based is something we expect,” he said.