CoinSwitch Kuber, a startup that allows young users in India to invest in cryptocurrencies, said on Thursday it has raised $25 million in a new financing round as it looks to expand its reach in India, the world's second-largest internet market and also the place where the future of private cryptocurrencies remains uncertain for now.
Tiger Global financed the entire Series B funding round of CoinSwitch Kuber and valued the three-year-old Indian startup at more than $500 million. The announcement of the Series B comes just three months after CoinSwitch closed its $15 million Series A round from Ribbit Capital, Sequoia Capital India and Kunal Shah. The Bangalore-based startup has raised $41.5 million to date.
TechCrunch reported earlier this month that the New York-headquartered technology hedge fund had led or was in advanced stages of talks to lead investments in many Indian startups, including CoinSwitch.
CoinSwitch Kuber is one of the handful of startups operating in the cryptocurrency space today. The crypto exchange allows users to buy slivers of several popular cryptocurrencies. A user on CoinSwitch, for instance, can buy small sachets of bitcoin and other currencies for as low as 100 Indian rupees ($1.30).
The startup said it has amassed over 4.5 million users, more than half of whom are aged 25 or younger. In the past 11 months, CoinSwitch Kuber said it processed transactions over $5 billion.
But how the startup, which aims to add 5.5 million users by the end of this year, performs in the future is not entirely in its hands.
While trading of private cryptocurrency such as bitcoin is currently legal in India, New Delhi is widely expected to introduce a law that bans all private cryptocurrency.
Ashish Singhal, co-founder and chief executive of CoinSwitch Kuber, said he is optimistic that India will not ban private cryptocurrencies, but said the startup closed the financing round with Tiger Global before New Delhi's indication to formulate a law.
"This investment round brings us at par with some of the most sought after cryptocurrency companies in the world and sets us up for the long run,” said Singhal.
In recent months, some crypto startups in India have started to explore a contingency plan in the event the nation does end up banning cryptocurrency trading in the country. Many startups are today building in India, but are focusing on serving customers overseas.
"As they build India’s leading cryptocurrency platform, CoinSwitch is well positioned to capture the tremendous growing interest in crypto among retail investors. We are excited to partner with CoinSwitch as they innovate in this emerging asset class,” said Scott Shleifer, Partner at Tiger Global, in a statement.