[Funding alert] Bengaluru-based Defy raises $5.5M seed round to build social crypto exchange

Bengaluru-based Defy, founded by Bhagaban Behera, Sriharsha Setty, and Nakul Kelkar, today announced a $5.5 million worth seed round for the parent company, Y Combinator-backed Walrus. The round was led by Goat VC, JAM Fund, and Goodwater Capital.

Also participating in this round were Gemba Capital, Night Ventures, GMO Venture Partners, Uncommon Capital, Soma Capital, and Olive Tree Capital, in addition to existing investor Better Capital.

With the fresh funding, Defy plans to build a social crypto exchange/platform with a community-based approach and allow users to create profiles and share portfolios with friends and followers. 

Bhagaban Behera, Co-founder and CEO, said:

“Defy is a coming-of-age fintech startup that aims at disrupting the cryptocurrency space in India. Our platform puts the user’s needs at the heart of the conversation. Defy is an app for crypto enthusiasts in India that embraces a friendly user experience keeping the intimidating crypto lingo at bay."

"Over the past 18 months, this asset class has caught everyone’s attention not only because it has emerged as the best asset class of 2021 but also because other asset classes are not able to fulfil the aspiration of the smart investors who want their money to grow in tandem with global growth rate," he added.

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Defy's funding comes amidst investor interest in India's swelling crypto market. Recent big-money deals for CoinDCX by Eduardo Saverin’s B Capital Group and CoinSwitch Kuber by Andreessen Horowitz (a16z) and Coinbase Ventures could be an indicator of a bullish outlook towards the future of India's crypto market.

In August 2021, a report by blockchain data platform Chainalysis ranked India second in terms of global crypto adoption in 2021 amidst global crypto adoption rising over 880 percent last year. In the report titled 'The 2021 Global Crypto Adoption Index', Chainalysis ranked India just behind Vietnam, which took first place out of 154 countries surveyed.

Further, the Indian government is likely to introduce a Bill on cryptocurrencies during the winter session of Parliament beginning November 29, in a bid to address regulatory concerns over crypto firms luring investors with misleading claims and for funding terror activities.

In this backdrop, crypto and Decentralised Finance (DeFi) are "providing greater access to an open financial system across the world, and Defy is positioned to bring that access to the largest number of users in India," said Justin Kan from Goat VC.