Crypto exchange CoinDCX has announced that it is working on a third-party custody solution that will be similar to a central depository like NSDL but for the Indian crypto industry.
Announced at the exchange’s flagship event Unfold 2024 in Bengaluru on December 3, the custody solution will be named Bharat Custody and will be launched around March-April 2025, said CoinDCX co-founder Sumit Gupta.
A central depository is a financial market infrastructure that provides safekeeping of securities such as shares and bonds. This comes at a time when rival WazirX is dealing with a $230-million crypto assets hack, wiping off nearly 40 percent of its user assets.
Speaking to the media on the sidelines of the event, Gupta said that he has started reaching out to other Indian crypto ecosystem players as well to work on this as a collaborative effort.
The solution will be fully automated and air gapped with zero connectivity to the internet, have advanced encryption protocols and AI-powered fraud detection systems. And the data would be stored entirely within the country across various locations including Bengaluru. Gupta said CoinDCX had started to work on the solution nearly two months back and has so far invested about Rs 50 crores into it, which he expects to double down on as required.
“When it comes to customer funds, you don't want to concentrate the risk on one place or on one entity. We believe that the ideal market structure needs to be in a way which is more comfortable to regulators. And regulators usually want to have different responsibilities assigned to different entities, which is their expertise,” Gupta said.
He added, “Inspired by the role of the National Securities Depository Limited (NSDL) in capital markets, Bharat Custody will be fully managed and hosted in India. It aims to empower Indian crypto investors and support exchanges by offering localized asset security and independent governance.”
According to Gupta, India is poised to grow to have around 100 million crypto investors in the next few years. At present the country has only about 30-35 million investors into crypto.
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