Coinbase of Southeast Asia

VeradiVerdict - Issue #138

Announced yesterday by a Techcrunch article, Pantera Capital led the Series A of Pintu, the fastest growing Indonesia crypto platform, with participation from Coinbase Ventures, Intudo Ventures, Blockchain.com Ventures, Castle Island Ventures, and Alameda Ventures.

Overview

Pintu is Indonesia's first mobile-first and user-friendly crypto exchange licensed by the Indonesian government that is focused on making crypto easier to digest with the goal of providing “a cryptocurrency bank for everyone”. As the first crypto aggregator in Indonesia, Pintu sources crypto from different marketplaces to offer the best prices for its customers and is the first in the world to issue a blockchain-based Indonesian Rupiah currency (“Rupiah Token”). Pintu is the only platform to offer fully localized educational and news content, taking a customer-first approach that alleviates investment fears through carefully developing a platform that is both friendly to new users and feature-rich to entice crypto natives. With its trading, deposit-taking, and P2P sending features, Pintu has the essential capability to run a digital bank powered by blockchain.

Market

One common question for international investors is how big the market is for a cryptocurrency company in Indonesia. According to Pintu’s internal estimates, last year Indonesia processed $10B USD in cryptoassets transactions, mostly through retail investors. Pintu targets the mass market to reach mainly first-time crypto users, accumulating 400,000 users in a short period of time.

Really, the comparables for Pintu are banks and the rise of fintech and tech companies in Indonesia are tremendous:

  • Sea Limited: NYSE-listed gaming / e-commerce company currently at $125B valuation

  • Grab Altimeter: Indonesian ride-hailing company to list at $40B valuation via SPAC

  • Gojek / Tokopedia: Indonesian ride-hailing company and e-commerce company merging at $18B, with plan for public listing at $35-40B

  • Traveloka: Indonesian travel services - likely public listing at $5B via SPAC

  • OVO: Indonesian payments company valued at $2.9B in 2019

The demographic / growth trends for Indonesia are also very strong for supporting total market size and growth rate:

  • Size of Indonesia’s internet economy at $44B in 2020 and $124B by 2025 (24% CAGR) by Google, Temasek, Bain

  • 4th largest country in the world at 273 million people

  • 175 million Internet users vs. 246 million in US

Why Pantera Invested

  • Fits our thesis of investing into local on-ramps and SEA. Our first investment in SEA was Coins.ph which sold to Gojek for $72M

  • Amazing team with strong product and startup experience

  • Focus on enabling a wider base of retail users, both young and older, to come into crypto and in general digital/mobile banking

  • Focus on a very large Indonesian market with aspirations to dominate Southeast Asia

  • Forward-thinking on regulations

  • Strategic local and crypto investors/partners around the table

- Paul V

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ABOUT ME

Hi, I’m Paul Veradittakit, a Partner at Pantera Capital, one of the oldest and largest institutional investors focused on investing in blockchain companies and cryptocurrencies. I’ve been in the industry since 2014, and the firm invests in equity, early stage token projects, and liquid cryptocurrencies on exchanges. I focus on early-stage investments and share my thoughts on what’s going on in the industry in this weekly newsletter.