key Takeaways:
Mudrex, an Indian cryptocurrency investment platform, is now offering U.S. spot-bitcoin exchange-traded funds (ETFs) to Indian investors.- The initial listings on Mudrex include four spot ETFs: BlackRock, Fidelity, Franklin Templeton, and Vanguard.
Mudrex, an Indian cryptocurrency investment platform, is set to introduce U.S. spot bitcoin exchange-traded funds (ETFs) to both institutional and retail investors in India, according to CEO and co-founder Edul Patel. This move reflects Mudrex’s aim to broaden investment opportunities for its users by providing access to the U.S. market through ETFs focused on bitcoin.
“This is much more valuable to institutions, as this was already available to retailers,” Patel said in an interview with CoinDesk. He noted that while retail clients in India could previously access spot-bitcoin ETFs through U.S. stock investing companies, Mudrex is pioneering the offering to institutions in the country. “As far as we know, we are the first in India to offer this service to institutions,” Patel emphasized. “We are certainly the first Indian crypto platform to offer this service.”
In its initial phase, Mudrex plans to list four spot ETFs: BlackRock, Fidelity, Franklin Templeton, and Vanguard.
Mudrex, which has received backing from Y-Combinator and is headquartered in California, operates a subsidiary registered with the Intelligence Unit of India. Additionally, it has established a presence in the European Union, holding licenses in Lithuania and Italy. Patel explained that while the actual transaction processing will be handled through broker partners in the U.S., Mudrex’s Indian subsidiary will oversee the facilitation of the spot-bitcoin ETF service.
The development is significant given India’s divided regulatory landscape regarding cryptocurrencies, with the central bank, the Reserve Bank of India (RBI), and the government’s Finance Ministry playing key roles. While the RBI has taken a firm stance against cryptocurrencies, including expressing concerns about the risks associated with crypto ETFs, the Finance Ministry’s Intelligence Unit has registered numerous Indian crypto service providers and imposed taxes on the sector. Although both entities prioritize protecting the Indian economy and investors, their regulatory approaches may differ.
“The bitcoin spot ETF functions as a security, and Indians are permitted to purchase securities under the Liberalized Remittance Scheme (LRS),” Patel explained. He emphasized that users or institutions seeking exposure to bitcoin can now utilize ETFs to diversify their portfolios.
Under the Liberalized Remittance Scheme (LRS), Indians can easily invest overseas. The RBI sets the overall LRS limit at $250,000 per year. Mudrex will enable investments in spot bitcoin ETFs on its platform with a minimum investment of $5,000 and a maximum of $250,000.
“The LRS presents a challenge for many individuals, but with our strong banking relationships in the U.S., we can facilitate these transactions seamlessly. This is why such services are crucial,” Patel stated.
Patel also revealed that among the 350 institutions collaborating with Mudrex, approximately 20 have initiated the process of joining, and he anticipates significant volumes with an average ticket size of $110,000.
