When Sathvik Vishwanath, Harish BV, Abhinand Kaseti and Sunny Ray started bitcoin wallet Unocoin in 2013, the cryptocurrency was trading at $200 — and no one really understood the concept of a cryptocurrency exchange. After last year’s surge in bitcoin’s value, Unocoin has emerged as the hotbed for investors. Vishwanath tells TOI how they reached 1 million customers without spending on marketing and why cryptocurrencies are the future of money. Why did you start looking at bitcoins as a space to start up in?I got interested in bitcoin while running my previous startup VentureNext, which provided scripting services for SecondLife, the online virtual world. SecondLife had virtual products and money that users could buy. I learnt about cryptocurrencies there. On SecondLife, users could load virtual money by converting actual money using Paypal, but most of it went towards transaction fees. Around this time, I attended quite a few meetups in Bengaluru, and there were discussions about the technology but also about where one could buy bitcoins. This gave me the idea to start Unocoin with my friends Harish, Abhinand and Sunny. We organised a global bitcoin conference and launched Unocoin as a platform to buy, sell and store bitcoins.
You started up in a space which had no regulations or user interaction. How difficult was it?Quite. We sat with a lawyer and established our own regulatory guidelines. It took months. We had to make sure we did verification of users, got their address proof, PAN details. At that point, the most difficult part was to explain what bitcoins were. We would set up stalls at conferences and people would ask ‘what is this?’. If an explanation took more than 30 seconds, people would walk away. We were getting about 10 people a day on our platform. Our business was such that we sustained ourselves without an investor. Now, about 10,000 people make exchanges on the platform daily.
When did people start showing interest in cryptocurrency?It started happening in 2015 when the price started going up globally. By the end of 2016, we had one lakh users. It became much easier. We used to count the number of articles mentioning bitcoins. It went up from once a month in 2013 to 10 times a day in 2016. We stopped worrying about marketing. We got investment from Blume Ventures and Mumbai Angels in 2016. It all got bigger in 2017. One bitcoin was valued at Rs 13 lakh at one point.
The finance ministry has issued warnings about bitcoins, and has fears that exchanges could be tax havens. Has Unocoin faced more scrutiny?The tax authorities wanted to know the kind of investors using the platform. The government called us a ‘ponzi scheme’ and we want them to know that we are not. Regulation was always a challenge. We are not planning to counter the government. People who know about cryptocurrencies know that we are not a ponzi scheme. We never positioned ourselves as an investment advisor. We are a technology company and help peer-to-peer transactions. We explain it only to people who know about it. We are open to audits and are cooperating with the tax authorities. If the government does come out with regulations, it’ll be good.
With so many bitcoin exchange platforms now opening up in India, do you see the competition increasing?All the founders of exchange platforms are on a WhatsApp group, where we discuss the latest developments. There is no competition between us. We keep learning from one another.
Bitcoin prices have been fluctuating quite a bit. Do you think the high prices are short-lived?No one can predict anything, but cryptocurrency evangelists — who have predicted a lot of things correctly — say that bitcoins are going to rise further. It has been on the rise since 2013. So it’s not a temporary phenomenon. When we started, the value of a bitcoin was $200. Now it’s around $11,000. In a month, we will introduce other cryptocurrencies like Litecoin, Ethereum and Ripple.
Start a Conversation
Post comment