Delhi-based early-stage venture capital firm Impanix Capital has invested in a cryptocurrency trading platform, one person directly related to the development told VCCircle.
CoinGeto founder Gunit Singh told VCCircle that Impanix has pumped in Rs 12 crore ($1.8 million) in the company’s pre-Series A round, to mark its fifth bet.
CoinGeto, which is run by Delhi-based Hisun Business Solutions Pvt. Ltd, will use the capital to build the largest cryptocurrency exchange in India. It will trade in more than 30 currencies, including Bitcoin, Ethereum, Litecoin and Ripple. The company has already launched a beta version of its platform.
“Bitcoin and other cryptocurrencies have a bright future. They are here to stay and may eventually become the new payment mode for the masses,” said Singh, an alumnus of Guru Gobind Singh Indraprashtha University.
Singh, a cryptocurrency investor, joined hands with Rahul Jain and Ajay Gupta in 2017 to launch the platform. It started as an over-the-counter trading platform for Bitcoin. It seeks to launch a full-fledged exchange where one crypto can be converted to another.
The company claims to be currently offering its service to more than 10,000 clients and aims to increase its customer base to 300,000 within the next one year.
“We see cryptocurrencies playing an important role in digitalisation. We liked the team at CoinGeto, and believe that they will emerge as one of the top players,” said Archit Bhargava, a venture partner at Impanix Capital.
CoinGeto also plans to launch its own coin, ‘Geto’, which can be used to pay the exchange trading fees. Besides, the company is also partnering with merchants and partners to make Geto acceptable at stores. It has already established partnerships through which phone bills can be paid via Geto.
The key source of revenue for CoinGeto will be the 0.2% transaction fee for trading on the platform. It also intends to earn from the appreciation in value of the Geto coin. The company is targeting commissions of more than Rs 5 crore in the first year.
CoinGeto also plans to raise another $10 million through an initial coin offering (ICO) this year. The money will be used to target the international market and setup a decentralised exchange.
Impanix Capital, which is primarily a sector-agnostic investment firm, was launched in 2015. The fund, which is led by former financial consultant Sanjeev Bhargava, typically invests $250,000-$2 million in its portfolio companies.
While adoption of cryptocurrencies is at a very nascent stage in India, blockchain, the underlying technology for Bitcoin, is increasingly being adopted among financial institutions to enable cross-border, real-time financial transactions.
The cyptocurrency space in the country has also witnessed a few deals in the recent past. Last December, Mumbai-based Discidium Internet Labs Pvt Ltd, which operates multi-cryptocurrency trading platform Koinex, had raised an undisclosed amount in a pre-Series A funding round led by existing investor Beenext and cryptocurrency focused-fund Pantera Capital.
In September 2016, Bitcoin exchange Unocoin had raised $1.5 million (Rs 10 crore) in a pre-Series A funding round led by early-stage investor Blume Ventures, along with Mumbai Angels, ah! Ventures and other international investors, including Digital Currency Group, Boost VC, Bank to the Future and FundersClub.
In January 2016, Bitcoin mobile wallet Zebpay had raised around $1 million (Rs 6.6 crore) in Series A funding from Claris Life Sciences CMD Arjun Handa, Jindal Worldwide MD Amit Jindal and other unnamed investors.
*This article has been modified to correct the dollar figure in the second paragraph.