MC EXCLUSIVE No ambiguity in laws, Binance eyes major growth from India, says APAC Head SB Seker

SB Seker, Head of APAC, Binance

It has been a year since Binance registered with the Financial Intelligence Unit – India (FIU-IND), and the world’s largest crypto platform now wants to double down on its focus on the market.

SB Seker, Head of APAC at Binance tells us that the company serves over 292 million users worldwide and India stands out as a critical market. It is ranking among the fastest-growing regions globally with double digit growth YoY driven by high activity and strong user engagement for the platform.

In an interview, Seker discussed Binance’s plans for India, ongoing negotiations with the regulators, trading volume trends, challenges in expanding in the country, new offerings the exchange would like to offer and more.

Edited excerpts:

What’s the India gameplan looking like? Will you be setting up offices and teams here?

Our approach has been to maintain our FIU registration. We're a foreign company with FIU registration. We are looking at hiring great people in India to develop our presence on the ground. We don't have an office in India at this point yet.

Also, APAC is a leader in terms of year-on-year growth for digital assets (for Binance). We saw about 69-70% growth last year coming from APAC. And within that, India is by far the leader. It comfortably exceeds that growth pace.

India three years in a row is now on the top for crypto adoption, according to Chainalysis. So it's literally not only the fastest growing in the region, but also is a part of the network effect. It's the largest growing jurisdiction now.

Our ambitions for India are equally large. We want to be able to offer a full suite of products to our users across India.

We want to be able to cater to different demographic trends, including regional adoption, first-time users. There’s institutional adoption -- which is also massive in India.

Now that Bitcoin has crossed to its all-time high and the US regulatory landscape has been positive, how have trading volumes trending in India in response?

Rising tide lifts all boats. The US is by far the largest indicator of sort of global regulation trends that other countries see in the world. So positive development in that space obviously has a net positive flow for the market.

But India takes its own path as always. Within India, we're seeing a bit of a shift from FIU's position in terms of agglomeration framework. We are also monitoring the space to see what the RBI's position might be on of INR-denominated assets.

We're looking at the space to see what RBI's comfort level might be payments, merchant settlement and haven settlement models in India. None of this is going to happen overnight.

It's a big market with a lot of competing priorities within India in terms of their own personal institutional mandate on what they need to protect. But we are seeing an openness to innovation.

Are you seeing more institutional investors participate in this crypto boom on your platform?

Institutional adoption has been on the uptick for a while. It's not a new trend.

India's growth curve across digital assets, is correlated to the institutional adoption. It's not skewed towards either retail or institutional, so I think it's a safe trend.

There’s been an uptick in tokenized assets too, and that's where a lot of institutional exposure and interest is. There are two categories, generally, globally speaking.

The first is tokenized private credit, and the second is tokenized government securities. And between them, they take about close to 90% of the market for tokenized assets.

These are the areas we think will lead to greater institutional adoption. Though it's a global trend, India will probably be at the cutting edge of this.

From a regulatory perspective, what challenges are you forseeing in India? How is this market playing out as compared to the rest of the APAC region?

There's no one-size-fits-all in APAC. Every market has got its own local nuance, every regulator has their own strategic priority.

So, we take a hyper-localized approach in APAC. We don't necessarily compare to other markets because it's not our business. The good thing for India is we have very clear institutional frameworks from the regulatory perspective. We have the enforcement directorate that incorporates this on certain specific issues.

We have law enforcement agencies that we cooperate with. We help with training, with workshops, with recovery of assets. We have FIU that we deal with when it comes to AML (anti-money laundering) issues. We have the regulatory touchpoints with the right regulatory bodies, and we cooperate with them on that basis.

Indian laws are clear to us. I think that's actually a great thing because there's no ambiguity.

In terms of challenges, we are trying to understand where Indian regulators are going. In terms of harnessing this market that's obviously very interested in this (crypto) segment, how are they going to come up with policies and new regulatory frameworks that increasingly fit us while maintaining consumer safety. That's a given. But also, what level of innovation, what level of permissions are they going to allow to enable more products to come on board to service India.

Also read: Crypto regulations need clear vision and govt support, says Binance CEO Richard Teng

In terms of products and innovations, will we see more offerings coming to India? Any global Binance products that have come to India beyond spot trading?

Needs for retail customers are different from the institutional segment.

For retail, users are looking for functionality -- how to adopt crypto into part of their daily lives. Obviously, a lot of this is going to be the INR on-ramp off-ramp and it's going to be a critical thing.

We started Crypto-as-a-service on the institutional side and there we're engaging with institutions to effectively become a technology service provider to them, facing their end-users. We run this model in other parts of the world where we provide liquidity and best-in-class technology. But all of this again comes back to what is the regulatory patchwork that we need to put in place.

We want to bring all of this to the market, but we also want to do it in a way that is scalable and fully compliant at all times. One of the worst things that can happen is you start off on a product and then you're forced to get it all back, and that has user impact.

We don't like the negative impact. So, you can take as a given that Binance wants to bring all of its product suites to India.

What are going to be the key business focus areas for finance in India in say the next two to three years?

We want to be more deeply entrenched in the retail business. We want a significant number of our next billion users to come from India. There are only so many markets in this world that offer that size and scale, and that engagement level.

For technology companies, the most important thing to pay attention to is demographic. India has a demographic that we're not inside. When it comes to retail trading, we want to be able to enliven more and more categories of trading instruments, and that goes all the way down to like all trading and retrading.

We want to be able to enable daily use cases. You know, making government payments, making car payments. All of these things are critical.

On the institutional side, we want to be able to provide liquidity, we want to provide a services which are modular, and do traditional financial institutions, and to other digital asset companies.

We want an economic, financial, freedom and inclusion for all, and we want to power the crypto wave that makes that vision possible, and I think that's been our driving force, and all of this I've just said kind of feeds into that.

What are your immediate hiring plans in India? How big is the team at the moment?

We have about 20 to 30 people working on India-specific matters, and not all of them are based in India though. But my personal preference is we're going down the path of hyper-localization when it comes to wallets, e-holders.

Different countries have different mix, but it's part of a long-term localization model, where there are certain things that we just want locally. I think one thing we want to do is to have strong teams locally in key markets.

At this point, we'd love to find a leader locally in India to take us to the next five years, who we'd be able to work with and build a team around.

Also read: Inside Bhutan’s push to become a crypto hub