Indian cryptocurrency investment platform Mudrex is now offering U.S. spot-bitcoin exchange-traded funds (ETFs) to Indian investors.
Mudrex will initially list four spot ETFs – BlackRock, Fidelity, Franklin Templeton and Vanguard.
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Indian cryptocurrency investment platform Mudrex plans to offer U.S. spot bitcoin (BTC) exchange-traded funds (ETFs) to institutional and retail investors in India, CEO and co-founder Edul Patel said.
“This is much more valuable to institutions, as this was already available to retailers,” Patel said in an interview with CoinDesk. Retail clients in the country could access spot-bitcoin ETFs through U.S. stock investing companies, but “as far as we know” we are the first in India to offer this service to institutions, Patel said. “We are certainly the first Indian crypto platform to offer this service.”
In the first phase, Mudrex will list four spot ETFs – BlackRock, Fidelity, Franklin Templeton and Vanguard.
Mudrex, which is backed by Y-Combinator and based in California, has a subsidiary registered with the Financial Investigation Unit of India. It also has a toehold in the European Union, with licenses in Lithuania and Italy. The firm will ensure the processing of the actual transaction through broker partners in the U.S., while the Indian subsidiary will facilitate the spot-bitcoin ETF service, Patel told CoinDesk.
The development is unprecedented because India’s crypto regulatory environment is divided between the central bank, the Reserve Bank of India (RBI), and the government led by the Finance Ministry. The RBI has been staunchly against crypto, also stating recently that India doesn’t need to emulate the U.S. on its position around crypto ETFs because its economy cannot afford such risk. However, the Finance Ministry’s Financial Investigation Unit has registered more than two dozen Indian crypto service providers and imposed stiff taxes on the sector. While the two agree on the need to protect the Indian economy and investors, their regulatory focus can appear to differ.
“The bitcoin spot ETF works as a security and Indians are allowed to purchase securities under the Liberalised Remittance Scheme (LRS) and, as a result, users or institutions specifically, who do want to get access to bitcoin can now start using the bitcoins through ETFs to diversify their portfolio,” Patel said.
The LRS simplifies overseas investments for Indians. The overall LRS limit, as prescribed by the Reserve Bank of India, is $250,000 a year. Mudrex will facilitate investing in spot bitcoin ETFs on its platform with a minimum investment of $5,000 and a maximum of $250,000.
“The LRS is the tricky part for most people and over there (in the U.S.), because we also have strong banking relationships, we’re able to help users do these transactions in a very seamless way, and that’s why these services are important,” Patel said.
Patel also said that among the 350 institutions that work with the company, about 20 have initiated the process of joining and he expects volumes with the average ticket size of $110,000.
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