Interview: 2023 Year-End Wrap With CoinDCX Co-Founder Neeraj Khandelwal

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As we conclude 2023, a year marked by regulatory challenges and unprecedented growth, the cryptocurrency industry stands at the crossroads of uncertainty and promise. In an exclusive interview with India’s largest crypto exchange and the first crypto unicorn, CoinDCX’s Co-founder Neeraj Khandelwal shares insights into the highs and lows of 2023 and paints an optimistic picture of what awaits the crypto community in 2024.

Regulatory Challenges and Industry Growth

The past year has been a paradoxical journey for the cryptocurrency industry, as Khandelwal reflects on the dual challenges faced from regulators while experiencing rapid growth. “On the one hand, we faced challenges from regulators globally and in India. On the other hand, the industry saw massive growth, which can be seen even in prices,” says Khandelwal.

“There have been very positive regulatory developments across the globe in 2023. Regions like the UAE have matured in terms of how they perceive regulations and implement them. Regulators are gaining a deeper understanding of the industry, and as a result, they are developing more finely-tuned guidelines.”

Crypto Regulations: Only a Question of When

Talking about the crypto regulations in India, CoinDCX co-founder said that regulations will definitely come in India. It’s not a question of if; it’s a question of when, he said.

“At the grassroots level, officials are increasingly showing keen interest in the technology and the crypto space. They are gaining a deeper understanding of how things work in this domain, and this growing enthusiasm is a very positive sign.

Currently, India employs a 1% TDS (Tax deductible at source) on all crypto transactions, which has caused local crypto traders to ditch Indian exchanges in place for foreign exchanges to save on taxes. Calling on the government to reconsider the 1% TDS tax, Khandelwal said:

“The absolute worst scenario for the crypto industry, characterized by high transaction volumes, is the imposition of a 1% Tax Deducted at Source (TDS). In transaction-driven sectors, where numerous transactions occur daily, a 1% TDS is the most detrimental outcome. For instance, in the blockchain space, users may engage in 10 or even 100 transactions a day. A 1% TDS is a death blow to the industry.”

Scalability of Blockchain

2023 was a year of technological maturity for the crypto industry, with layer 2 solutions maturing at scale. Khandelwal emphasizes the pivotal role of scalability in blockchain. “Scalability in blockchain was achieved in 2023, with chains now capable of processing thousands of transactions per second at a very low cost, making it ripe for mass adoption.” This development signifies a critical milestone that propels blockchain technology closer to broader acceptance.

Onboarding Users onto Blockchain Through Okto

CoinDCX’s another successful venture this year was the growth of its self-custodial wallet, Okto. The self-custodial wallet registered over 200,000+ users in just 6 months of its launch and is currently active in over 70+ companies.

“The total number of investors in the crypto space is approximately 400 million. However, when you look at the users of blockchain for purposes beyond investment, the number comes down to just around 15 million unique users, based on on-chain data. So, while there are over 400 million investors in technology-associated tokens, only 15 million people have actively utilized blockchain. This calls for significant efforts to attract more users to the blockchain. With Okto, we aim to play our part in bridging this gap.”

Earlier this month, Okto unveiled its SDK-embedded wallet, enabling any traditional Web 2.0-based company to seamlessly unlock the potential of Web3.0, decentralization, and smart contracts.

Crypto Outlook for 2024

Looking ahead, Khandelwal shares his optimistic outlook for the crypto industry in 2024. Factors such as the potential approval of a spot Bitcoin ETF, Bitcoin halving, and ongoing technological advancements contribute to his positive forecast. “2024 is going to be an explosive year for technologies because more and more users will start adopting blockchain,” states Khandelwal. This forecast aligns with the broader trend of increasing institutional interest and advancements in blockchain scalability.

He also pointed out that, with everything aligned, Bitcoin might see another all-time high next year.

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