Indian Crypto Giant CoinSwitch Implements Workforce Cuts Amidst Market Downturn
Indian cryptocurrency trading platform CoinSwitch has reportedly made the tough decision to downsize its workforce, a move that reflects the ongoing challenges faced by the crypto industry. According to local news agency Moneycontrol, CoinSwitch, a crypto startup backed by Tiger Global, has laid off 44 members of its customer support team in the month of August. The layoffs are attributed to a decline in customer queries due to the substantial drop in cryptocurrency trading volumes. This announcement comes shortly after CoinDCX, another major crypto exchange in India, also reduced its workforce by around 12 percent.
CoinSwitch’s spokesperson, in response to queries from Moneycontrol, highlighted the company’s commitment to remaining competitive and innovative in the ever-changing crypto landscape. The spokesperson clarified that the company undertook a thorough assessment of its operations and concluded that the customer support team needed to be right-sized to match the existing volume of customer inquiries on their platform. This adjustment resulted in 44 customer support team members voluntarily resigning from their roles after detailed discussions with their managers earlier in the month.
Over the past year, CoinSwitch had transitioned many support team members into other roles based on their skill sets. The spokesperson assured that the company is offering support to the affected employees and expressed openness to rehiring them when the volume of queries grows and new roles become available.
The crypto industry in India is facing multiple challenges, most notably regulatory uncertainty and high taxation. With a 30 percent tax on gains from virtual digital assets and a 1 percent TDS (Tax Deducted at Source) applied to every crypto transaction exceeding Rs 10,000 on exchanges, liquidity issues have arisen, leading to a significant decline in trading volumes of around 85-90 percent.
CoinSwitch, which stands as one of India’s two crypto unicorns and the most highly valued, encountered its valuation peak at $1.9 billion in 2021. Investors such as Coinbase Ventures, Andreessen Horowitz (a16z), Tiger Global, Sequoia Capital, and Paradigm contributed to its funding.
The recent layoffs have not been limited to the customer support team alone. While CoinSwitch initially mentioned layoffs in the operations team, the company later clarified that it maintains a flat organizational structure with minimal hierarchy. A company spokesperson elaborated that the terms “customer support team” and “customer operations team” are sometimes used interchangeably. The spokesperson also emphasized that the company follows a half-yearly appraisal cycle, refuting claims of a quarterly one.
Employees affected by the layoffs, who chose to remain anonymous, shared their experiences. Some reported sudden loss of access to their roles, including team leads, agents, support staff, senior managers, and quality analysts. It was mentioned that the layoffs weren’t solely based on performance, and some employees were offered severance pay of up to four months.
Despite these challenges, CoinSwitch appears to be actively strategizing for the future. The company has recently been hiring new employees and reportedly maintains a funding runway of five years. Additionally, CoinSwitch aims to diversify its offerings beyond cryptocurrencies and is reportedly in discussions with regulators to introduce various financial products, including fixed deposits, mutual funds, bonds, stocks, and exchange-traded funds.
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