Tak Lee Explores India’s Web3 innovation

With over a decade of experience in venture capital and cross-border investments, Tak Lee is shaping Web3 innovation in emerging markets. As CEO and Managing Partner at Hashed Emergent, he leads investments across India, Southeast Asia, MENA, and more, backing startups like Theya, Reclaim, and TravClan.

A seasoned investor, Tak has advised Korean VC funds on high-growth Indian companies like Licious, Dunzo, and MyGlamm. His entrepreneurial journey in India and deep understanding of its regulatory landscape uniquely position him to discuss how the country is balancing regulation with Web3 innovation.

Driving Web3 Innovation

How do you see India's regulatory landscape evolving for Web3? Do you believe the recent initiatives like the National Blockchain Framework are sufficient to foster innovation and attract investment?

India’s Web3 regulatory landscape is evolving but still faces significant challenges. While initiatives like the National Blockchain Framework show intent, policies such as high taxes on Virtual Digital Assets (VDAs) hinder startups' liquidity and growth.

The G20 summit under India’s presidency marked progress by driving global consensus on crypto frameworks, providing a foundation for further development.

India boasts the world’s second-largest Web3 talent pool, but regulatory ambiguity, inconsistent banking practices, and limited compliance frameworks pose barriers, pushing innovation offshore. To unlock its potential, India must adopt pragmatic measures like simplified compliance, sandboxes, public-private collaboration, and progressive policies inspired by nations like Singapore and UAE. These steps can position India as a global leader in blockchain innovation and sustainable growth.

What are the key challenges and opportunities that Indian Web3 startups face in navigating the regulatory landscape?

India is a pivotal player in the Web3 ecosystem, boasting the world’s second-largest Web3 developer base and third-largest founder community. Its startups are driving innovation across sectors like finance, healthcare, and supply chain, leveraging blockchain for transparency and AI for user-centric applications.

Despite this potential, regulatory challenges such as high VDA taxes, unclear AML/KYC rules, and restrictive banking practices hinder growth, pushing many founders to relocate abroad. However, Indian entrepreneurs remain resilient, blending local expertise with global strategies to stay competitive.

To sustain its leadership, India needs a cohesive regulatory framework, tax reforms, and inclusive banking policies. With the right measures, it can solidify its position as a global hub for Web3 innovation.

What are the most promising sectors or sub-sectors within the Indian Web3 ecosystem that Hashed Emergent is currently focusing on? 

Hashed Emergent focuses on Web3 innovation tailored to emerging markets like India, emphasizing Web2.5 projects that combine scalable digital models with blockchain's decentralization. Key areas include DeFi, gaming, and infrastructure, with DeFi poised to enhance financial inclusion for India’s unbanked population and gaming fostering asset ownership and community-driven economies.

The firm sees significant potential in stablecoins and RWA tokenization for cost-effective cross-border transactions. With $20 million invested in 31 startups, including Theya and Glip, Hashed Emergent supports founders through regulatory guidance and global connections, driving solutions for local challenges while scaling globally.

How do you evaluate the potential for growth and scalability of Indian Web3 startups compared to the

India’s Web3 ecosystem excels at addressing local and global challenges simultaneously, with startups driving innovation across key sectors. Decentralized commerce platforms empower small businesses, while blockchain-based infrastructure enhances cross-chain interoperability, enterprise security, and transaction speed.

Real-world asset tokenization and blockchain-driven healthcare and supply chain solutions are transforming industries by improving efficiency and trust. Startups are leveraging cost-effective blockchain platforms and integrating AI to create scalable, user-friendly applications suited for price-sensitive markets.

"What further strengthens India’s position is the ongoing collaboration between startups and government-led blockchain initiatives. Public-sector use cases such as land record digitization, public distribution systems, and decentralized identity management provide startups with institutional backing and opportunities to scale solutions for broader adoption."

How can blockchain technology be leveraged to address specific challenges faced by emerging markets like India, such as financial inclusion, supply chain transparency, and digital identity? 

Blockchain technology has the potential to solve systemic challenges in financial inclusion, supply chain transparency, and digital identity, particularly in emerging markets like India. Its decentralized architecture enables secure, scalable, and cost-efficient services while fostering trust and transparency.

In financial inclusion, blockchain-based platforms can overcome traditional credit barriers, offering microloans and insurance to unbanked populations by leveraging alternative data. Public, permissionless blockchains are key to ensuring openness and scalability.

In supply chains, blockchain enhances traceability in sectors like agriculture and pharmaceuticals, ensuring fair pricing for farmers and reducing counterfeit risks in medicines. Immutable public blockchains provide greater confidence and accountability than private networks.

For digital identity, blockchain can create inclusive and secure systems for millions lacking formal identification, ensuring broad access to essential services. Public blockchains’ openness and interoperability are critical for fostering equity and efficiency in digital ecosystems.

"India’s ongoing focus on digitization makes it an ideal environment for blockchain adoption. However, scaling these solutions will require robust infrastructure, strong public-private partnerships, and forward-looking policies. By prioritizing the use of public blockchains to maintain transparency, openness, and scalability, India has the opportunity to set a global benchmark for blockchain-powered innovation."

This strategy will not only address critical local challenges but also position India as a leader in Web3, demonstrating how decentralized technologies can build a more equitable, resilient, and efficient digital ecosystem. With an informed and collaborative approach, blockchain can unlock unprecedented opportunities for sustainable growth and inclusive development.

What are the unique opportunities and challenges that arise when deploying blockchain solutions in emerging markets with varying levels of technological infrastructure and regulatory frameworks?

Blockchain solutions can transform emerging markets by addressing gaps in financial access, transparency, and efficiency. Mobile-first blockchain platforms empower unbanked populations with microloans, remittances, and secure payments, enabling broader economic participation. In land registries, blockchain’s immutable records combat corruption and inefficiency, ensuring equitable access.

In agriculture, decentralized supply chain systems improve traceability, reduce middlemen, and ensure fair pricing for farmers while meeting the demand for sustainable, verifiable systems.

Despite these opportunities, challenges like unreliable rural internet, low digital literacy, and fragmented regulations hinder adoption. Tailored solutions, phased pilot programs, and collaborations with governments and local stakeholders are vital. Leveraging public blockchains ensures scalability, transparency, and interoperability, paving the way for blockchain’s long-term success in these regions.

What are the key factors driving the growth of the Web3 ecosystem in India? How can India attract and retain top talent in this field?

India’s Web3 ecosystem thrives on its status as the world’s second-largest Web3 developer base, attracting global ecosystems and driving innovation across finance, supply chain, healthcare, and governance. Aligning blockchain with India’s digital transformation initiatives has spurred projects like blockchain-based land registries and digital identity solutions, fostering local and global innovation.

To sustain this growth, India must address regulatory challenges, including high taxes on Virtual Digital Assets (VDAs) and ambiguous compliance rules, to retain talent and encourage local innovation. Investments in skill development, mentorship, and public-private partnerships will be critical to equipping developers with hands-on experience and ensuring sustainable growth in the Web3 sector.

"Creating pathways for long-term career opportunities in Web3 is equally important. Companies must provide not just technical roles but also leadership and strategy-focused opportunities, ensuring that India’s Web3 workforce evolves beyond development into areas like product design, governance, and ecosystem building. By fostering a supportive environment for talent growth and creating opportunities for meaningful innovation, India can not only retain its top talent but also establish itself as a global leader in the Web3 space."

What initiatives can be taken to foster a vibrant and collaborative Web3 community in India?

Building a robust Web3 community in India requires flagship events, grassroots initiatives, and investments in talent and infrastructure. Flagship events like the India Blockchain Week (IBW) Conference foster collaboration among industry leaders, policymakers, and global pioneers. This year’s IBW, hosted by Hashed Emergent on December 4-5 in Bengaluru, features over 100 side events, including hackathons and Web3 Demo Days, creating a bridge between local and international Web3 ecosystems.

Community-driven initiatives, such as hackathons and developer workshops, provide hands-on exposure and mentorship, strengthening the talent pool and accelerating blockchain adoption. Government-backed programs, including grants, training, and incubation, can address skill gaps and promote public-private partnerships to develop scalable solutions in sectors like governance, healthcare, and supply chains.

Sustainability efforts, including career development pathways, funding for startups, and collaborative local hubs, are crucial for long-term growth. These strategies will position India as a global Web3 leader, driving innovation and inclusion through blockchain’s transformative potential.

What is your vision for the future of Web3 in India? How do you see India's position in the global Web3 landscape evolving over the next few years?

What are the key factors that will determine India's success in becoming a leading Web3 hub?

India's success as a leading Web3 hub depends on regulatory clarity, talent development, ecosystem collaboration, and innovation. Supportive government policies on taxation, compliance, and blockchain adoption are crucial to building investor confidence and fostering a thriving environment for startups and developers.

Expanding Web3 literacy beyond early adopters to include businesses, institutions, and citizens through initiatives like training programs and workshops will encourage broader adoption. Establishing strong connections between Indian talent and global markets will unlock collaboration and export opportunities for scalable solutions.

Infrastructure development, particularly interoperable blockchain platforms and middleware, is vital for scaling decentralized applications across sectors. By focusing on regulatory reform, talent development, global collaboration, and foundational technology, India can position itself as a sustainable leader in the global Web3 ecosystem.