Startup Deep Dive : ZebPay — the Indian crypto exchange that was banned, exiled and reborn

In September 2018 one of India’s oldest crypto exchanges did something no growth story ever plans for: it told its own customers to take their money and go. ZebPay, launched in 2014 and later crossing 6 million registered users and close to $22 billion in cumulative trading volume by its own count, shut its Indian exchange rather than run a business the Reserve Bank of India had just cut off from the banking system.

What followed is the part worth studying. The company did not die. It moved abroad, kept trading, watched the Supreme Court strike down the RBI order on 4 March 2020, came home the same year under new ownership, and then had to survive a 30% tax and a 1% TDS that gutted volumes across the whole Indian market. ZebPay is a rare case of an Indian startup that was effectively banned, exiled, and reborn — and it is still here in 2026. This is how that happened, and what it cost.

Quick facts

What ZebPay does

ZebPay is a crypto-asset exchange for retail Indians. A user completes KYC, deposits rupees, and buys or sells Bitcoin, Ether and a few hundred other tokens through an app and website; ZebPay holds the assets in custody and takes a cut on each trade. It sells simplicity to first-time buyers rather than the derivatives and margin tools that draw professional traders. Around the core exchange it has bolted on yield products — crypto fixed deposits and a lending platform that pays a fixed return on deposited coins — and, more recently, features pitched at recurring, SIP-style buying. The company describes itself as one of India’s longest-running exchanges and says it has served more than 6 million registered users with close to $22 billion in lifetime trading volume.

The origin

The story starts before the ZebPay name. Mahin Gupta, a software engineer, had been building around Bitcoin since 2012 and ran an early Indian venture called BuySellBitco.in. He teamed up with Sandeep Goenka and Saurabh Agrawal, and in 2014 the three of them turned that experiment into ZebPay. As Forbes India recounted, each founder wanted something different — Gupta to be first in the technology, Goenka to catch the next big trend, Agrawal to build a large business — but they shared one plain goal: take Bitcoin to ordinary Indians who found exchanges frightening.

The corporate scaffolding was split from the start. A holding entity, Zeb Ventures Pte Ltd, was registered in Singapore in August 2014, while the Indian exchange and wallet ran through an Ahmedabad company, Zeb IT Service Pvt Ltd. The product bet was mobile-first: ZebPay pushed a phone app in July 2015, at a time when most crypto trading still happened on clunky web terminals. That single decision — make buying Bitcoin feel like using any other Indian fintech app — is what pulled in a mainstream audience and gave ZebPay its early lead.

The struggle years

The near-death was not a product failure. It was policy. On 6 April 2018 the Reserve Bank of India issued a circular ordering the banks and payment firms it regulates to stop serving anyone dealing in virtual currencies, and to wind down existing relationships within three months. For an exchange, losing banking is losing the ability to take a rupee deposit or send a rupee withdrawal. It is a slow suffocation.

ZebPay held on through the summer and then gave up the fight. On 28 September 2018 it shut its Indian exchange, telling users to withdraw their money before the door closed. All three founders resigned from the operating company the following month, in October 2018. The Indian entity, Zeb IT Service Pvt Ltd, was then wound up. It did not go quietly: on 16 March 2019 the Minister of State for Finance and Corporate Affairs told Parliament that the company had violated Companies Act norms and that prosecutions had been filed, matters the company later resolved on payment of a penalty, as Inc42 reported.

Rather than close entirely, ZebPay took the business offshore. Through late 2018 and 2019 it set up in Malta, launched a global exchange in December 2018, opened trading for Australian customers and planned a Melbourne base, and made Singapore its home. The company that had been built to bring Bitcoin to Indians spent nearly two years unable to legally serve most of them.

The turning point

The single event that brought ZebPay home was a court ruling. On 4 March 2020, in Internet and Mobile Association of India v Reserve Bank of India, the Supreme Court struck down the 2018 banking circular, holding that the restriction was disproportionate to the risks the RBI had cited. Overnight, the legal ground that had forced the shutdown was gone.

The numbers on either side of that date tell the story. Before it, ZebPay had zero rupee on-ramp in India and an exiled business run out of Singapore and Malta. After it, exchanges could bank again, and a crypto boom followed through 2020 and 2021 as prices ran up worldwide. ZebPay had already begun its India comeback in early 2020, and it re-entered a market it once led but now had to win back from newer rivals such as WazirX and CoinDCX that had grown during its absence. The exile had cost it the thing an early mover most fears losing: its head start.

The money behind it

ZebPay is not a typical venture-funded rocket, and its cap table reflects that. The verifiable points:

• External venture funding is small: about $1.12 million across two early rounds from four investors, with the last tracked round dated January 2016 (Tracxn, Crunchbase). ZebPay never raised the mega-rounds that WazirX or CoinDCX did.
• The defining capital event was an ownership change, not a fundraise. Rahul Pagidipati — a US-based investor whose family office, Ayon Capital, had backed healthcare companies — bought a majority of ZebPay in 2019–20 and became CEO. The three founders were left with a cumulative stake reported at under 10%.
• The Singapore holding structure (Zeb Ventures Pte Ltd, later Awlencan Innovations Pte Ltd, which holds the ZebPay trademark) sat above the operating entities, a common arrangement for a company that had to run across India, Australia, Malta and Singapore.
• The current Indian operating company, Awlencan Innovations India Limited, is an unlisted public company incorporated on 28 September 2018, with authorised capital of ₹1 crore and paid-up capital of about ₹22.7 lakh (MCA records via Tofler and Instafinancials).

In short: ZebPay’s story is one of an acquisition and a turnaround under a new owner, not a serial fundraising climb. That has consequences for how it must make money, covered next.

How it makes money

The business model is the classic exchange model, applied to crypto:

• Trading fees. The core revenue line is a fee on each buy and sell — a small percentage of the trade value, charged to both sides. When volumes are high, this line is very profitable because the marginal cost of one more trade is close to zero.
• Spreads and conversion. On simpler “instant buy” flows, the price shown to a retail user embeds a margin, so the exchange earns on the spread as well as on the stated fee.
• Yield and lending products. ZebPay’s crypto fixed deposits, lending and “earn” features let users lock up coins for a fixed return; the platform earns the difference between what it makes deploying those assets and what it pays out.
• Withdrawal and network fees. Smaller line items charged when users move assets off the platform.

The part people get wrong: an exchange’s revenue is not steady like a subscription. It is a near-direct function of trading volume, which rises and falls with the crypto market and — in India specifically — with tax policy. A single tax change can do more to ZebPay’s revenue in a quarter than any product launch, as the next sections show.

The numbers

ZebPay does not publish audited quarterly results, and its Indian entity’s granular profit-and-loss lines sit behind paid filing databases, so the responsible thing is to report only what is sourced and to label the gaps. The verifiable, MCA-derived figures (via Tofler) are these, all for the year to 31 March 2025:

What that adds up to: after the 2022 tax shock crushed Indian crypto volumes, ZebPay’s Indian entity was still profitable and growing fast off a low base in FY25, with revenue reported in the ₹50–100 crore band. But note the scale. This is a company measured in tens of crores of revenue and roughly 40 employees, not the hundreds of crores and thousands of staff its cumulative-volume headline might suggest. Where a precise multi-year revenue and profit table would normally sit, the audited rupee figures are simply not in the public record, and inventing them would defeat the point of this piece.

Where the money comes from

The economics concentrate in a few places:

• Retail, not institutions. ZebPay’s franchise is everyday Indian buyers doing spot trades, not high-frequency or institutional desks. That makes revenue sensitive to retail sentiment and to how easy it is to move rupees in and out.
• Volume over headcount. With about 40 employees against 6 million-plus registered users and a claimed $22 billion in lifetime volume, the model is built to scale on servers, not staff. Operating leverage is the whole game: in a bull market, revenue can jump without much added cost.
• A few large tokens do the heavy lifting. As on most exchanges, a small set of assets led by Bitcoin and Ether typically drives the bulk of turnover, even though hundreds are listed.
• The surprise: geography flipped on ZebPay. The company that defined itself as India-first spent 2018–2020 earning abroad — in Australia, Malta and via Singapore — because it could not legally serve India. Today the India business is back at the centre, but the international footprint is why there was still a company to bring home.

The risks

• Tax-driven volume flight. The 2022 Union Budget imposed a flat 30% tax on crypto gains (from 1 April 2022) and a 1% TDS on transactions above ₹50,000 in a financial year (from 1 July 2022). The 1% TDS is the sharp edge: it is levied on the transaction, not the profit, so active traders lose 1% of turnover on every sale regardless of whether they made money. Volumes on Indian exchanges fell heavily afterward, and much trading moved to offshore platforms and peer-to-peer. This is a direct, mechanical hit to ZebPay’s core fee revenue, and it has not been rolled back.
• Regulatory whiplash. ZebPay has already been shut once by a regulator and revived by a court. Since March 2023, exchanges must register with the Financial Intelligence Unit (FIU-IND) under anti-money-laundering law, adding compliance cost, and India still has no comprehensive crypto law — only tax and AML rules. A future policy turn could again change the business overnight, as the 2018 circular did.
• Custody and security. ZebPay holds users’ assets, which makes it a target. The collapse of a rival, WazirX, after a large 2024 hack showed how quickly an Indian exchange’s trust — and its users — can evaporate. A single serious breach would threaten the deposits ZebPay’s whole model rests on.
• Lost first-mover lead. The two-year exile handed ground to CoinDCX and WazirX. ZebPay now competes for a market it once led, which caps how much of any Indian crypto recovery it can capture.

The takeaway

ZebPay’s transferable lesson is about what actually kills — and saves — a startup. The company was never brought down by a better competitor or a broken product; it was brought down by a rule, and it was saved by a court, and then squeezed again by a tax. For any founder in a regulated space — payments, lending, health, crypto — the real moat is not features but the ability to survive a hostile policy shift: a corporate structure that can operate across borders, enough capital discipline to shrink without dying, and the patience to wait out a court. ZebPay lost its head start and most of its founders’ ownership along the way. That it is still trading in 2026 is not a story of dominance. It is a story of endurance, which for a company that was once effectively banned is the more unusual achievement.

Frequently asked questions

Is ZebPay one of India’s oldest crypto exchanges?

Yes. ZebPay launched in 2014 and grew out of an earlier 2012 Bitcoin venture, BuySellBitco.in, which makes it one of the earliest Indian crypto exchanges still operating in 2026.

Why did ZebPay shut down in India in 2018?

The Reserve Bank of India’s April 2018 circular ordered banks to stop serving crypto firms. Without banking access, ZebPay could not process rupee deposits or withdrawals, so it closed its Indian exchange on 28 September 2018 and asked users to withdraw their funds.

How did ZebPay come back to India?

On 4 March 2020 the Supreme Court struck down the RBI’s banking ban in the IAMAI case. ZebPay, which had moved operations to Singapore, Malta and Australia, relaunched in India the same year under new majority owner Rahul Pagidipati.

Who owns ZebPay now?

Rahul Pagidipati, who bought the majority stake in 2019–20 through his family office Ayon Capital and serves as CEO. The three original founders were reported to hold under 10% cumulatively after the change. The Indian app is operated by Awlencan Innovations India Limited.

How does the 1% TDS affect ZebPay users?

Since 1 July 2022, a 1% tax is deducted at source on crypto sales above ₹50,000 in a financial year, on top of a 30% tax on gains. Because the TDS applies to the transaction rather than the profit, it discourages frequent trading and has pushed volumes down across Indian exchanges, including ZebPay.

Sources

Figures are as of September 2026. Dollar amounts ($22 billion cumulative volume; about $1.12 million funding) are as reported in US dollars by the company and by funding databases, and are not currency conversions.

• Forbes India — “Zebpay and its big bet on bitcoins” (founding and founders), 2017
• YourStory — “Return of ZebPay” (November 2020) and “How crypto exchange ZebPay revived from shutdown” (September 2021)
• Inc42 — “Bitcoin Exchange Zeb IT Under Liquidation, Violated Companies Act” (2019); ZebPay company and leadership coverage, 2022–2026
• Entrackr — “After shutting down operations in India, crypto exchange Zebpay moves to Malta” (October 2018)
• news.bitcoin.com / FXStreet — ZebPay India relaunch coverage, February 2020
• CoinDesk — “India’s Supreme Court Lifts Banking Ban on Crypto Exchanges” (4 March 2020); SCC Online and Oxford Law Blog on IAMAI v RBI
• CoinDesk / Yahoo Finance — ZebPay’s Australia launch, 2019
• IBS Intelligence, CIOL, Financial IT — Rahul Pagidipati reappointed CEO, 2025; leadership timeline
• Tofler and Instafinancials — Awlencan Innovations India Limited (CIN U72100TS2018FLC177177): incorporation 28 September 2018, capital, FY25 revenue band and year-on-year growth (from MCA filings)
• Tracxn — Awlencan Innovations India Limited profile: employee count (about 40, February 2026); ZebPay funding (about $1.12 million); Crunchbase — ZebPay funding and Rahul Pagidipati profile
• ZebPay — official About Us page (6 million-plus registered users, close to $22 billion cumulative volume, milestones)
• ClearTax, CryptoTimes and government budget coverage — 30% VDA tax (from 1 April 2022), 1% TDS (from 1 July 2022), FIU-IND registration under PMLA (from March 2023)

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