Meet Kunji, a startup simplifying crypto investments via digital asset managers
After working closely as a vice president with Web2 startup founding teams for decades, Anurag Dixit was intrigued by the world of Web3 and cryptocurrency. However, he observed that like him, most new investors in the segment found cryptocurrencies difficult to comprehend.
To enable easy crypto investments, he joined forces with his long-time cryptocurrency trader friends Pankaj Jangid, Vivek Pandey, and Harivadan Pandya to start Kunji.
Launched in June 2022,is a centralised crypto asset management platform that enables users to make passive crypto investments.
“Many investors are drawn to cryptocurrency as an asset class because they find it intriguing and do not want to miss out on it. However, due to lack of awareness, inappropriate crypto trading abilities, and shortage of time, investors hesitate to invest in crypto,” says Anurag.
In a survey conducted by The Economist Intelligence Unit, 51% of the investors who participated in it had said that a lack of knowledge about the cryptocurrency asset market was the biggest obstacle to investing in the industry. About 34% of Web2 users said they were worried about related security issues, and 29% said they were unsure of where to buy cryptocurrencies.
Virginia-headquartered Kunji also intends to educate investors through digital asset managers.
Unlike traditional asset management firms, crypto asset management incorporates tokenised assets—any asset whose value has been transferred to a blockchain.
Anurag draws an analogy between Kunji and a digital key. “Digital keys are essential in cryptography. Likewise there’s a paradigm shift in how assets can be managed, sold, and financed, and we want Kunji to be key to the digital wealth management platform.”
How Kunji works
The startup partners with expert crypto traders, much like any traditional asset management platform does. These traders operate as digital asset managers (DAM).
These DAMs, with significant domain expertise, offer an investment thesis to investors. They create strategies, focus areas, and risk assessments and then create investment pools (DAP—Digital Asset Pool) for investors.
“Investors must sign up on our platform, enter a code, and complete the KYC in order to join our Beta list. After that is completed, investors will see a list of pools on their dashboard where they can view strategy, risk, and the pools' historical performance. Investors can select from one or more pools based on that information. Once investors make an investment, DAMs will manage their current portfolio,” Anurag tells The Decrypting Story.
The minimum investment in these pools is Rs 10.
In light of the current crypto market crisis, Kunji intends to keep the information regarding the pools as transparent as possible with the investors.
DAMs have currently identified three investment pools based on users’ risk appetite. The three pools are: The Top Cap Digital Assets Pool, Arbitrage Opportunities Balanced Pool, and Alpha Blue Chip Focused Pool.
Top Cap Digital Pool focuses on investing in 15 cryptocurrencies by market capitalisation. While the other two pools focus on digital assets like DeFi and Metaverse tokens apart from Bitcoin and Ethereum.
Tokens on the platform are listed on factors including a project's strength, liquidity, and use cases.
“We take this action in an effort to keep potentially dangerous assets out of the game. We can't completely remove risks, but we can eliminate the ones we deem to be untrustworthy and dangerous,” he adds.
The platform is live in the Beta phase with 200 users. DAMs take 30% of the total return from the user as a part of the commission.
Anurag says “DAMs only generate revenue only if investors in the pool make money. If an investor’s pool is not performing well then, DAM’s don’t make money.”
Kunji is still deciding the revenue percentage, but once the platform goes live, the startup intends to generate revenue through platform fees from DAMs, transaction fees and fiat conversion or reconversion fees.
Market and model
As per the reports by Markets and Markets, the global crypto asset management market size is projected to grow from $0.4 billion in 2021 to $1.2 billion by 2026, at a Compound Annual Growth Rate (CAGR) of 21.5%. During this projection period, Asia Pacific region (APAC) is expected to pave way for considerable growth possibilities for players operating in the crypto asset market.
Several new players including KoinBasket, Flint, Pillow and others are offering solutions in the crypto wealth management space. Centralised cryptocurrency-based financial (CeFi) platforms likecontinue to be the market favourites as they provide custodian solutions and user-friendly interfaces.
“Majority of players offer a basket of tokens, their share is static because market opportunities shift over time. The biggest differentiator here is the approach we are incorporating to provide solutions. We let investors have authority and control. DAMs are limited to trading on the platform; no one is permitted to withdraw funds except the user” Anurag adds.
The startup says that DAMs frequently communicate with users, whether it is to provide updates on the state of the market or to explain how the trade's financial results were arrived at. When investors seek advice from digital asset managers, their identities are kept confidential.
The co-founder asserts that they are catering to a global market and will comply with regulations the government imposes. “Each government has its own set of rules. We do not just concentrate on the Indian market. It is not exclusive to a particular region or nation. We are targeting the global market and we will comply with local regulations of each country,” Anurag says.
The way ahead
Kunji aims to go live by August-end. “At present, we have three investment pools, and we are creating one more pool before the launch,” he adds.
The startup comprises 14 members including the co-founders and DAMs and in the future, the startup intends to expand its team.
The startup raised an undisclosed amount of funds in the seed round led by private and angel investors. Currently, the startup is looking to raise funds.