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CoinSwitch Aims to Disrupt Indian Stock Trading, Challenges Zerodha, and Upstox

CoinSwitch Sets Stage for Innovation, Enters Indian Stock Trading Arena, Poised for Growth

19 June 2023

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Kunal Tyagi

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  • CoinSwitch aims to enter the Indian stock trading market and compete with established brokerage firms like Zerodha, Groww, Upstox, and Paytm Money.

  • The company plans to apply for a stockbroker license with SEBI and is in talks with NBFCs and banks to offer fixed deposits.

  • CoinSwitch's shift in strategy is a result of regulatory changes that delayed their plan to provide trading and investment in US stocks under the LRS.

Cryptocurrency investment platform CoinSwitch is eyeing the Indian stock trading market as it seeks to compete with tech-driven brokerage firms such as Zerodha, Groww, Upstox, and Paytm Money. The company plans to apply for a stockbroker license with the Securities and Exchange Board of India (SEBI) and is in discussions with non-banking financial companies (NBFCs) and banks to offer fixed deposits. This strategic move comes after delays in the company's plan to provide trading and investment in US stocks due to regulatory changes.


CoinSwitch's Shift in Strategy:


CoinSwitch had initially planned to offer trading and investments in US stocks but was hindered by changes in the Liberalised Remittance Scheme (LRS) for retail investors. The increased tax collected at source (TCS) for foreign remittances under the LRS prompted the company to redirect its focus to the Indian stock trading business. The company aims to differentiate itself by providing distinctive propositions and advantages to compete with established players like Zerodha and Upstox.


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Diversifying Product Offerings:


Ashish Singhal, Co-founder and CEO of CoinSwitch has expressed the company's intention to offer financial products beyond cryptocurrencies. Singhal stated that the firm aims to become a comprehensive wealth-tech platform, with plans to introduce seven new products by the end of the next year. These products will include fixed deposits, bonds, exchange-traded funds (ETFs), stocks, and mutual funds, expanding their services beyond cryptocurrencies.


Challenges and Opportunities:


Entering the stock trading space presents both challenges and opportunities for CoinSwitch. The company will need to obtain a stockbroker license from SEBI, demonstrating compliance with regulatory requirements. However, this move also has the potential to drive innovation and improvements in the industry. Competition among trading platforms may lead to the introduction of new features and technologies, benefiting both stock trading and the cryptocurrency market.


Market Impact and Future Plans:


The entry of CoinSwitch into the Indian stock trading market is expected to diversify the industry and generate increased interest from users. Established players like Zerodha and Upstox have already witnessed a decline in their consumer bases, leading to lower-than-expected revenues. CoinSwitch's strategic move aims to tap into the growing popularity of cryptocurrencies while expanding into other financial instruments. With a strong foundation in the cryptocurrency market, the company aims to become India's go-to wealth-tech destination.


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