Sharansh Guha

India is ranked #1 in crypto adoption globally for the third time in a row. That’s progress. However, regulations haven’t caught up with adoption yet. At Mudrex, we surveyed over 9,000 investors to understand their views on crypto regulation, taxation, and education in India. And the message from this survey is loud and clear: —93% of Indians acknowledge the need for crypto regulation. Within this, 56% support comprehensive rules, 24% prefer minimal regulation, and 13% want it limited to taxation. —50% of respondents want a dedicated crypto regulator. —84% feel current taxation is unfair compared to other asset classes. Another, two-thirds highlight the 30% flat tax on gains as the biggest barrier, while 12% point to the inability to offset losses. —64% see crypto as a tool for long-term wealth creation, signaling growing maturity among Indian investors. —Nearly 9 in 10 say they would invest more if policies became clearer and more favourable. —44% learn crypto from YouTube, while news (19%), friends & family (15%), and Twitter (14%) show the mix of trusted voices and community validation. These numbers paint a clear picture: Indian investors are ready, informed, and thinking long-term. What’s missing is clarity. A segment-specific regulatory approach is the only way to balance investor protection with industry growth. The right regulations won’t hold us back. They’ll push us forward and scale adoption. For those who’d like to dive deeper, the full report is available here.

104

11 Comments

Reserve Bank of India (RBI) launched UMI( Unified Market Interface) will enable issuance of digital assets , tokenisation use cases through RBI’s Digital Currency(Digital Rupee- using wholesale CBDC). This will enable Tokenisation adoption at scale in India! AUnified Markets Interface (UMI) which is envisioned as new next generation financial market infrastructure - Governor Sanjay Malhotra said. #tokenization #digitalassets #assettokenization #cbdc #india

40

3 Comments

𝐑𝐁𝐈 𝐬𝐭𝐫𝐞𝐧𝐠𝐭𝐡𝐞𝐧𝐬 𝐚𝐮𝐭𝐡𝐞𝐧𝐭𝐢𝐜𝐚𝐭𝐢𝐨𝐧 𝐟𝐨𝐫 𝐝𝐢𝐠𝐢𝐭𝐚𝐥 𝐩𝐚𝐲𝐦𝐞𝐧𝐭𝐬 The 𝐑𝐁𝐈 𝐃𝐢𝐫𝐞𝐜𝐭𝐢𝐨𝐧𝐬, 𝟐𝟎𝟐𝟓 set new benchmarks for secure transactions in India’s digital economy: 𝐓𝐢𝐦𝐞𝐥𝐢𝐧𝐞: Domestic compliance – 𝐀𝐩𝐫 𝟏, 𝟐𝟎𝟐𝟔 Cross-border compliance – 𝐎𝐜𝐭 𝟏, 𝟐𝟎𝟐𝟔 𝟐𝐅𝐀 𝐦𝐚𝐧𝐝𝐚𝐭𝐨𝐫𝐲 for all domestic digital payments — with at least one factor being 𝐝𝐲𝐧𝐚𝐦𝐢𝐜 & 𝐮𝐧𝐢𝐪𝐮𝐞 𝐩𝐞𝐫 𝐭𝐫𝐚𝐧𝐬𝐚𝐜𝐭𝐢𝐨𝐧. 𝐈𝐧𝐭𝐞𝐫𝐨𝐩𝐞𝐫𝐚𝐛𝐢𝐥𝐢𝐭𝐲: tokenisation & authentication services must be accessible across apps in the same ecosystem. 𝐑𝐢𝐬𝐤-𝐛𝐚𝐬𝐞𝐝 𝐜𝐡𝐞𝐜𝐤𝐬: issuers encouraged to use behavioural, device & location data; DigiLocker can be leveraged for high-risk confirmations. 𝐈𝐬𝐬𝐮𝐞𝐫 𝐚𝐜𝐜𝐨𝐮𝐧𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲: comply with the 𝐃𝐏𝐃𝐏 𝐀𝐜𝐭, 𝟐𝟎𝟐𝟑, ensure robust authentication, and 𝐜𝐨𝐦𝐩𝐞𝐧𝐬𝐚𝐭𝐞 𝐜𝐮𝐬𝐭𝐨𝐦𝐞𝐫𝐬 𝐟𝐮𝐥𝐥𝐲 for non-compliant losses. 𝐄𝐱𝐞𝐦𝐩𝐭𝐢𝐨𝐧𝐬 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞: small-value contactless, recurring e-mandates (post-first), NETC tolls, offline small-value payments, select PPIs, corporate travel bookings. 𝐂𝐫𝐨𝐬𝐬-𝐛𝐨𝐫𝐝𝐞𝐫 𝐂𝐍𝐏 𝐭𝐫𝐚𝐧𝐬𝐚𝐜𝐭𝐢𝐨𝐧𝐬: by 𝐎𝐜𝐭 𝟏, 𝟐𝟎𝟐𝟔, issuers must validate overseas requests, register BINs with networks, and adopt risk frameworks. A strong step towards 𝐬𝐚𝐟𝐞𝐫, 𝐬𝐞𝐚𝐦𝐥𝐞𝐬𝐬 & 𝐟𝐮𝐭𝐮𝐫𝐞-𝐫𝐞𝐚𝐝𝐲 𝐩𝐚𝐲𝐦𝐞𝐧𝐭𝐬. #RBI #DigitalPayments #Fintech #Compliance #CyberSecurity #DPDP #Innovation

34

Pine Labs IPO: $6B Ambition, $1B Raise – Can the Numbers Justify It? Pine Labs has filed its Draft Red Herring Prospectus (DRHP) for one of India’s largest fintech IPOs, aiming to raise $1 billion at a $6 billion valuation. The company plans to use the proceeds for debt repayment, subsidiary investments, technology development (cloud, AI/ML), device procurement for market expansion, strategic acquisitions, and general corporate purposes. The Company & Its Evolution Founded in 1998 by three IIT graduates in a Noida garage, Pine Labs started as a payment terminal provider. Over the years, it has transformed into a full-stack merchant payments platform operating in India, Southeast Asia, and the UAE. Key milestones: 2015: EMI & affordability solutions launched 2018: Merchant analytics platform introduced 2019: Southeast Asia expansion Acquisitions: Setu ($70–75M), QwikCilver, Saluto Wellness Business Model Pine Labs earns from: Transaction fees (avg. 1.5% merchant service fees) Subscription revenue from devices Interest income from BNPL & EMI products Processing fees from card and digital payments FY24 scale: 570,000+ merchants, $30B annual processing, 3.44B transactions. The Financial Reality Revenue CAGR: 12.4% (FY19–FY24) despite COVID FY24 revenue: ₹1,384 Cr (+4.2% YoY) Loss-making every year: ₹369 Cr cumulative losses in 5 years FY24 net margin: -13.5% (worst in history) Heavy reliance on external financing: ₹5,044 Cr raised over 5 years Asset turnover decline: 0.25x → 0.17x (The ratio compares the rupee amount of revenues to the company's total assets to measure the efficiency of the company's operations) Valuation Analysis Ask: $6B (~₹49,800 Cr) = 30.7x FY24 revenue Industry norm: 2–6x revenue multiples For perspective, Paytm—10x Pine Labs’ revenue, profitable at the EBITDA level, and with 96M consumer users—trades at just 3.3x revenue in public markets. The contrast raises questions about whether Pine Labs’ premium is warranted. Key Risks from DRHP Customer concentration: 31–35% revenue from top 10 clients Auditor-flagged IT control weaknesses Intense competition (254 players in India alone) Pricing pressure and regulatory compliance challenges No clear roadmap to profitability Unanswered Questions When will Pine Labs achieve sustainable profitability? Can it reduce dependence on top customers? Can it scale internationally without heavy capex and further dilution? Will emerging payment technologies (CBDCs, new rails) disrupt its core model? Pine Labs has undeniable scale, strong partnerships, and a diversified payments ecosystem. But at $6B, the valuation demands either a rapid path to profitability or outsized revenue growth—neither of which is certain today. The IPO will test whether public markets still reward scale over sustainable earnings in India’s fintech sector. Side-note - It is available in private markets at ~4.5 Bn valuation.

55

6 Comments

#FinTech | #Lending | #Payments :  The use of cashless payments translates into improved access to #capital from FinTech lenders. In the context of unsecured lending to small businesses in India, NBER working paper research highlights that higher usage of cashless payments yields a higher likelihood of obtaining a loan, reduced interest rates, and larger loan amounts. Cashless payment usage also predicts a lower likelihood of default.  As cashless payments continue to rise in prominence and accessibility across the globe, NBER research underscores the unique value of payment records as rich sources of information for evaluating borrower's creditworthiness and for making financial intermediation more efficient. Source : Pulak Ghosh, Boris Vallee, and Yao Zeng NBER Working Paper No. 34148.

36

3 Comments