Y Combinator-backed Mochatrade raised $5.5 million in a seed round led by CoinFund with participation from Coinbase Ventures. The platform wants to let users in India take positions in perpetual contracts that track US share prices, funded in rupees through UPI. Users will not own the shares and will not need an account with a US broker. The service has not launched yet and the company reports a waiting list of 25,000 people.

What it means: Perpetual contracts started in the crypto market and are now moving to traditional assets such as shares. Mochatrade targets a huge base of active Indian investors who find it hard to reach US markets because of cost, currency limits and paperwork. Paying through UPI makes the product very accessible, but that is also where the risk lies: these are leveraged derivatives, where users do not get a share and can lose their capital quickly. Indian regulators have already voiced concern about large retail losses in derivatives, so how the product will be treated remains an open question. In Europe, similar retail products fall under MiFID II rules and ESMA's restrictions on CFDs, such as leverage limits and risk warnings, while MiCA does not cover share derivatives. For Greek fintechs, the trend shows crypto market technology is now being used for traditional products. Anyone considering something similar for the European market should start from the investment firm licence and investor protection, not from the user experience.

Read the original on The Economic Times

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