Cypher Capital launches $100 million blockchain fund, with an aim to invest 40% of it in crypto startups in India

• Cypher Capital has set aside $40 million of its seed fund towards Indian cryptocurrency and blockchain startups.
• The private venture capital firm says it has already invested in fifteen Indian companies, including SolRazr and Safle.
• Business Insider caught up with the company at the 2022 AIBC UAE Expo to understand the firm's plans for India.

Cypher Capital, a private venture capital firm, announced the launch of a $100 million blockchain fund, and it aims to invest 40% of it in Indian cryptocurrency and blockchain startups.

Cypher Capital is a UAE-based venture capital firm and it has made investments in fifteen Indian blockchain startups like SolRazr and Safle. While SolRazr is a new Solana-based decentralised platform, Safle offers storing digital identities and over 500 digital assets, protected using a master key.

There is a reason the firm has reserved a $40 million seed fund for Indian startups – India has over 100 million cryptocurrency users, and despite the regulatory uncertainty and adverse comments, Cypher Capital’s Vineet Budki is confident that the policies will normalise over time.

And it’s not just Cypher Capital that is bullish on the Indian market – in 2021 alone, Indian cryptocurrency and blockchain startups saw funding worth $638 million, according to industry tracker Tracxn. This includes some big names like Andreessen Horowitz, Sequoia India, Kalaari Capital and Antler India.

“India with its 100 million crypto users is the next big market for cryptocurrency adoption and we believe in educating people on the use cases like DeFi (Decentralised Finance) lending and borrowing, play to earn, etc., and handholding blockchain startups to build valuable companies,” said Vineet Budki, managing partner of Cypher Capital.

Business Insider caught up with Vineet Budki at the 2022 AIBC UAE expo, to understand why his company is bullish on the prospects of cryptocurrency and blockchain in India. Here’s what he had to say:

Looking beyond the speculative strain of crypto trading

Blockchain has multiple use cases, theoretically, but not all of them can or are needed to be implemented in the real world, as things stand today.

However, one of the areas where blockchain can help is the tokenisation of physical assets, allowing investors to own assets that they otherwise wouldn’t be able to due to the amount of capital needed.

This way, large assets can be divided into smaller fractions, bringing down the required capital outlay so more people can afford to purchase those assets.

Apart from this, Budki also stated that the recent policy clarifications regarding prohibiting set-off of losses across various cryptocurrency coins, the 1% TDS on every crypto trade and the 30% tax on gains are not causes for concern to the firm.

He justifies this stance by saying that over a longer period of time, these regulations will stabilise and there will be certainty as mass adoption of cryptocurrencies and blockchain will drive regulation and help it evolve.

Disclosure: The author attended the event at the invitation of Cypher Capital, who paid for travel and accommodation. However, the editorial piece is independent and has not been shared with the firm before publishing.
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