Nischal Shetty, founder and CEO of WazirX took to cryptocurrency after his previous business was hit by actions of global tech giants. A software engineer from Mumbai, Shetty shares his story with Mint. Edited excerpts:
Tell us about your background
I’m a software developer. I grew up in Mumbai and studied engineering in Mangalore. I worked in a company in Bengaluru for 2 years before being hired by a start-up in Mumbai called Burrp.com in 2010. This is how I got introduced to the world of startups and entrepreneurship. On weekends I used to try different coding projects, just as a hobby. One of these was an app to manage social media, called Crowdfire. This was the early days of social media networks like Facebook and Twitter and we were able to spot ways in which users could improve their social media following. To give you an example, our app could identify all the followers of your competitors and follow them – thus making them aware of you and migrate to you. Crowdfire grew rapidly and I was able to quit my regular job and shift to managing it. Eventually however the western tech giants changed the rules and now you cannot really grow your social media following without paying them in some way. Crowdfire of course still exists in B2B format, but its previous individual-facing avatar is no more. It is this situation – dependence on centralised giant corporations that got me interested in cryptocurrency and blockchain which are by definition decentralised.
Why did you launch WazirX?
I began dabbling in crypto in 2017 and towards the end of the year I had identified several gaps in the market. There were long waiting times to buy bitcoin and spreads were too high. Bitcoin exchanges were faceless and this created a trust problem. I decided to launch an exchange and enter this space towards the end of that year. In this exchange, I was a very visible face and was available on social media from the inception. Initially I just put up a page announcing the launch and asking users to sign up – I got 20,000 signups with just that! WazirX was launched in March 2018, shortly before the RBI ban on crypto related payments. The ban actually became our opportunity. Established exchanges folded up or left India. We pivoted to a crypto-to-crypto model. Traders could still convert rupee to crypto and back on our exchange – it’s just that the transactions were carried out through an escrow route rather than directly through our bank account. For example, if A wanted to buy crypto from B, the seller B would have to deposit crypto at our exchange which we held in escrow. Once B gave us confirmation that he had received the funds, we would release the crypto to A.
Tell us about why you sold the exchange to Binance in 2019
I was looking for global expertise and Binance fit that bill. There wasn’t much innovation in crypto in India but there was plenty happening abroad. The Binance…