Crypto Bourses Talk Consolidation Amid Regulatory Glare

Cryptocurrency exchanges are set to see consolidation amidst concerns and confusion over government attempts to regulate crypto assets. Some of the exchanges have begun exploratory talks with other Indian exchanges and foreign players, multiple people involved in discussions have told ET.

Currently there are around 25-30 Indian crypto exchanges, all almost offering similar services and backed by similar technology. “We’re in talks with some domestic and international players,” said Shivam Thakral, CEO BuyUcoin.

Industry trackers say that the fear is that the government regulations could mean that only few players may be allowed to operate. “Consolidation is part of a business life cycle in all industries. As companies strive to improve business efficiencies and expand offerings to capture customers’ lifetime value with asset investment as a use case, we may see a similar phase,” said Sharan Nair, chief business officer, CoinSwitch Kuber.

Also, the government could be out regulations where uniformity around prices if cryptocurrencies and other regulations may be required. “Profitability for an operational crypto exchange/Platform might decrease in case of a cost intensive, non-flexible and conservative crypto regulation policy by the government. The barrier to entry for global and domestic platforms could become a major issue with new policies, in which case we can expect a lot of M&A activities from the global players,” said Thakral.

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