Praveen Kumar, the CEO of Belfrics Global, who himself is headquartered out of Kuala Lumpur, spoke with CryptoNinjas this week and shared a lot of information behind the live launch of the Belfrics exchange in India. Mr. Kumar discusses recent developments of the company as a whole, what is going on in India, and his career in financial services. It was this week that Belfrics Global went live with their new digital asset exchange for India while also opening up brand new offices in the country in the city of Bengaluru.
The Belfrics Group of Companies includes a global digital asset exchange based in Singapore while also operating regional exchanges for India, China, Kenya, Indonesia, Malaysia, Dubai and Hong Kong. The regional exchanges allow for swapping and trading digital currencies with the fiat currency where that regional exchange is based. In contrast, the global exchange based in Singapore provides for USD based transactions.
Read the interview in full below:
Hi Praveen, good to catch up with you today, can you talk about the launch of Belfrics India this week? How long has the development taken?
It is almost two years since we conceptualized Belfrics. We were ready with our exchange platform by the 1st quarter of 2016, but we wanted to provide the merchant services also along with the trading facilities. It took another couple of quarters for us to complete the merchant applications. We had our Belfrics India launch on the 16th of this month.
What is unique about your exchange compared to some established players in the industry?
Our intention and goal is to become benchmark liquidity provider for bitcoin trading in local currencies. As and when bitcoin adoption increases, it is highly unlikely that a person from Asia or a person from Africa is going to trade bitcoins against US dollars. Both customers and merchants will want the bitcoin to be transacted swiftly against their national currencies. Sooner or later, all existing major players will also adopt a similar strategy. When this shift happens, we would like to place ourselves as the primary source of bitcoin liquidity in the regions that we operate.
Where is your headquarters and do you have a physical office with staff?
We are headquartered in Kuala Lumpur, Malaysia. We have our offices and staffs in Malaysia, Singapore, India, and Kenya as of now. Our policy is to have a physical presence in all operating regions.
How do you view recent developments in India with the abolishment of big bank notes and the ensuing spike in bitcoin prices on Indian cryptocurrency exchanges?
The demonetization has made a drastic change in the consumer perception towards digital payment adoptions. There is a sense of urgency and open minded approach towards alternative payments methods, which was not there before the demonetization period. India is a nation with a huge consumer base and a considerable amount of transactions were done on a cash basis only. It will be quite a challenging and daunting task for the government to keep the growth engine rolling with reduced cash activities. Irrespective of the short term hit the government would be taking on reduced business activities, I personally feel it is the right move in the nation’s interest on a long run.
Considerably low bitcoin liquidity in the Indian market has led the price hike on Indian exchanges as against the overseas counterparts. For quite some time to come, Indian consumers are going to be net buyers of BTC and hence can expect a premium rate when bitcoin price advances further.
How does the government view cryptocurrency in India, do you welcome regulation?
The government is committed to making the nation a cashless economy and hence I expect that the Government and RBI will keep an open-minded approach towards the emerging technologies in the financial sector. I assume that they will want to see the Indian digital currency market evolve to a considerable size, before taking a step to regulate the industry. I am a strong believer that any kind of investment instrument or investment services should be regulated to protect the consumers. Having said that, the regulation doesn’t have to be attached to illogical and unsustainable terms and conditions for the conduct of business.
How do you view other cryptocurrencies beyond bitcoin?
There will be many more cryptocurrencies flowing into the market and some might grow to a considerable stature and could give a run to bitcoin currency, but I assume bitcoin will lead the cryptocurrency lot for some years to come.
Are you aware of the new Indian international investment zone in Gujarat, GIFT City? Do you think digital currency has a place there?
There are many SEZ projects in India, but GIFT is first of a kind initiative in India to promote India as a hub for International financial services offerings. GIFT provides attractive options for capital market participants to offer their service to global clients and FDIs to tap the Indian market.
Having said that, India traditionally has not been a major center for offshore financial services offerings. In addition, GIFT route will not help the international digital currency exchanges to target Indian market. Unless and until a clear regulatory framework is developed for digital currencies by the RBI, I do not see international digital currency exchanges to take benefit of GIFT.
Can you discuss your experience at Alpari, heading the brokerage brand for India from 2009?
Heading Alpari in India was a great experience. Alpari had an unprecedented growth in India, which many of the other firms couldn’t achieve. Our ability to develop and train partners and associates throughout India helped us to establish the brand effectively.
How was your experience in the futures markets? How does it compare with now operating in the cryptocurrency sector?
I have been actively involved in commodity and forex derivative trading for over a decade. I served with both Indian and international OTC & exchange brokers before taking an entrepreneurial route. By providing liquidity services to the Indian commodity exchange and Singapore mercantile exchange, I garnered my experience and interest in clearing services for commodities and FX derivatives.
I got involved in cryptocurrency trading in 2012 and fell in love with the technology instantly.
As compared to providing trading services in FX and commodities, the challenge with bitcoin is that many people still do not know what bitcoin is. With cryptocurrency, there will be an added responsibility for the exchanges to handhold the customer to walk through the transition phase from paper currency to digital currency.
What is the meaning behind the Belfrics brand?
Since bitcoin is expected to be the king of currencies, we thought of combining the King (Bel) and ruler (ric) in our name.
Any numbers with volumes, numbers of users, you care to share?
We already have a good number of registered customers with us, but would like to release the numbers after a couple of quarters of our full launch.