India’s cryptocurrency landscape is amassing strength as the growth of crypto-assets and the technologies underlying it is captivating retail investors and entrepreneurs throughout the nation. On one hand, where the technological innovations related to crypto-assets are offering promising potentials with public blockchain technologies and the use of smart contracts in the operations, on the other hand, the newness of the ecosystem and the absence of a regulatory framework in India is inhibiting the sector from gaining trust and exposing the investors to small risks.
The technological innovations related to crypto-assets are offering promising potentials.
Recently the Indian government indicated that it was planning to introduce a bill on cryptocurrency and its plan for a Central Banking Digital Currency during the budget session of the parliament. Through the bill, it wanted to bring a regulatory framework around crypto, use its underlying technology, and through the Reserve Bank of India build its own CBDC. The Indian crypto stakeholders such as us are actively engaging with the Indian government to allow India to have the crypto industry function under friendlier regulations where the operators work within the legal framework of the land and are taxed accordingly.
The Indian government indicated that it was planning to introduce a bill on cryptocurrency.
Individually as a crypto asset exchange, we have developed an internal framework to channelize risks associated with cryptocurrencies towards higher returns. With this framework, we aim to strengthen the protection of retail investors by better informing them not only about a well-calibrated token-listing process that projects have to undergo to become eligible to buy/sell on CoinDCX Go, but also educate the investors about the risks, characteristics, technicals, and fundamentals associated with a crypto project. The entire framework of listing a coin on CoinDCX Go is created with three main objectives – enhancing investor protection, maintaining fair and transparent markets, and reducing systemic risk by giving ample diversification opportunities. CoinDCX has named this framework -7M, as the company analyses every project using the following Metrics.
With this 7M framework, we aim to strengthen the protection of retail investors.
A successful business model represents a map of how it is going to create value for a discrete group of people or for the industry as a whole. Having a sound, value-creating, and revenue-generating business model ensures stability, sustainability, and growth led by innovation. Every business model is created with a) an objective that will be solving a crucial problem; b) a vision beyond the immediate concept where the project has established a system in its network in which the problem has ceased to exist or curbed at max.
Decentralization has been the core principle of the blockchain industry and our next step is to analyze a project’s effectiveness in maintaining immutability, transparency, automation, and resilience with its decentralized business model. CoinDCX evaluates the proficiency of the project’s business model in the highly competitive crypto space and the numbers a project will be able to achieve if it successfully reaches every milestone of its roadmap.
A well-experienced team leads the project with coherence in their strategies and collective progress towards the project’s vision. A balanced combination of hard and soft skills, the ability to overcome technical and entrepreneurial hurdles, the team of advisors and partners, clear articulation of thoughts from management to the customers, timely accomplishments of the milestones, and the ability to cope up with adverse situations are some of the factors which are chiefly considered in this framework.
CoinDCX conducts in-depth evaluations and SWOT analysis of these projects. Understanding and defining the Market of the project in which the product is being offered is key to its growth. Our team carefully studies the size of its existing market, competitors activities, unique selling points (USPs) of the project, product’s ability to acquire a significant market share alongside coping up with the future threats, and then exhibit growth in the industry which evolving rapidly
Every project is using blockchain, building a network, and circulating a token within its network. The demand and supply of the token decide the price of the token, and this same demand and supply are decided by the utilities the token has within the network. Our team seeks an understanding of the application of blockchain, use cases, tokenomics, and the value generation spots of their tokens.
7M’s Momentum identifies the traction the project has received on social media over a period of time and the reputation a project has developed from its inception. We track the perception with which a project is perceived and study the company’s roadmap, its expansion in multiple directions, the network effects, partnerships established with high-profile organizations, and expansion of the existing customer base with active acquisition and growth strategies.
Our financial researchers have developed comprehensive asset valuation and financial models which help us to evaluate the reasonability and feasibility of the financial valuation of the company. These models also help us to foresee the outstanding debt obligations of the company, the current funding they have received, incoming revenues, and the covering of the entire scope of the project with these numbers. Outside the financial models, we track the revenue generation spots, exchange listings, the token allocation models which subsequently affect the supply of the token.
This 7M framework represents the skeleton of a larger constitution CoinDCX has implemented internally. As India’s movements towards Digital India and a 5-trillion dollar economy progress with the advent of computerized money, the Government of India and the RBI will be exploring the potential of blockchain technology in financial services. With computerized money, India has the opportunity to take maximum advantage of investing in computerized and decentralized assets. Such investments require a strong foundation of awareness, education, and infrastructure which frameworks like 7M ensures from the very first day. Extraordinary circumstances need extraordinary measures and laying down investor-friendly structures which protect their funds and help them adopt an industry that is moving at an unbelievable pace.