How CoinDCX turned profitable?
Customer withdrawals on exchanges heads, concerns over the questionable financial valuation practice, and an unusually close relationship with Alameda, pushed FTX and Alameda into bankruptcy and shook the volatile crypto market, which lost billions and fell below a $1 trillion valuation in November 2022.
According to CoinKickoff, from 2013 to 2022, there were 2,383 crypto coin failures, which created a negative effect for exchanges too. Celsius Network, BlockFi, Gemini Trust, and many others were forced to shut their doors just because a virtual currency was traded at a highly inflated price point.
After "Black Monday" in 2008, a major chunk of stock market investors in India started believing the Share Market was just a scandal and a betting game. That's because of micro and nano participation, which turned out to be a high believer in TIP calling shares. It's been 15 years now and the investors who faced huge losses at that time still feels the same and some never even participated in the market anyhow after that. This fear of losing things again happens when humans face a tragic loss and makes them a believers inthe' never going back to the road ' philosophy.
This may happen in 2022 with cryptocurrencies, which even pressurized governments to take action over wrongdoings and draw a line of regulations around it.
After the downfall of many major players in the crypto exchange platforms & cryptocurrencies market, CoinDCX was able to stand alone and not just made their foundations stronger than any other player, they became PROFITABLE.
In 2021, CoinDCX raised $90 million in a Series C funding round at a valuation of $1.1 billion, becoming the first Indian cryptocurrency exchange to achieve unicorn status. In FY22, with more focus on consumer awareness and acquisition, they were at a loss of 41 Cr. In FY23, predicting the market conditions and how crypto exchanges were losing trust, CoinDCX turned around and made their brand image with regulations, and with more clarity on profitability, they were able to reach 28 Cr profit.
Check out this graphic below :
The operating expenses specifically accounted for Rs 67 crore in FY23, whereas it was Rs 185 crore in FY22. But how they were able to make things work when every second player in the market was witnessing a downfall or a call from the cremation ground?
Namaste Web3
Whenever a new age technology is created or introduced, their must be a rate of adoption in audience, it is simple demand and supply. If their is no demand of new technology/ assets why would have someone adapt it in his daily life. If cryptos are terms as assets, their must be a strong backing of technology to convience users to shift their capital from Gold to Cryptos.
Namaste Web3 was a set of events which educated people in person, reaching smaller cities like Ahmedabad, Pune, Jaipur. Impacted 2500+ people onground.
These initiatives gave CoinDCX a high ROI, as Tier 2 and 3 cities showed major envolvement in investing and trading cryptocurrencies over CoinDCX - as per their year end report of 2023.
领英推荐
User Experience
Wall street people can understand P&L with 3 colours lines and 5 columns, but a normal user can't. As they focused on Tier 2 and 3 cities, they have to make UI so simple and accessible that any human can read it, understand it and use it. Invest in cryptos, trade it and withdraw.
" The platform has gained popularity among Indian cryptocurrency investors due to its user-friendly interface, low fees, and a wide range of trading pairs. "
Making charts simpler and user-flow as simple to use, CoinDCX turned out to be a simple crpto investing and trading app among Indians.
Cost Cutting
Exchanges have seen more than 90% of their business volumes being impacted after the hefty tax imposition on crypto traders by the Indian government in August 2023. CoinDCX's management decided to layoff 12% of their workforce in Bear Market conditions. Diverted major focus on User Experience and Partnerships to make business grow.
According to CoinDCX, their?trading volume is over 16.5K Cr+ quarterly. With more liquidity and investors communication, they got more users-trust which resulted their incredible growth.
Partnerships with Chainalysis, BitGo, and OKEx. These partnerships have helped to enhance the platform’s security, compliance, and liquidity. Which plays an important role in securing future losses.
Cutting down expenses and generating multiple streams with partnerships gave them a hold on business model, user friendly interface gave user's a connect, CoinDCX our India's crypto unicorn became profitable in FY23.
That was ' In The Ishank's Mind ', if you like this newsletter edition, you can checkout this video too, you will surely like it :
Thank You, will catch you in next edition :)