India’s CoinSwitch Trims Workforce Amid Market Downturn
In the wake of an extended cryptocurrency market downturn, India’s CoinSwitch, a crypto investing app, has become the latest platform to downsize its staff, as reported by local news agency Moneycontrol on Monday.
Customer support cuts
The exchange has reportedly let 44 employees go from its customer support division this month, attributing the move to redundant roles caused by the bear market’s decline in customer queries.
In a statement, CoinSwitch explained: “We continuously evaluate our business to stay competitive, prioritizing innovation, value, and service for our customers. To that end, we right-sized our customer support team to align with the present volume of customer queries on our platform.”
The company noted that this decision led to the voluntary resignation of 44 members from its support team, following detailed discussions with their managers. The 44 employees represent a significant portion — approximately 8% — of CoinSwitch’s total workforce. The company’s LinkedIn profile currently indicates that it has 519 employees.
Following local industry trend
CoinSwitch’s staff reduction news emerged barely a week after another prominent local exchange, CoinDCX, downsized its workforce by 12%, based on an overall headcount of around 730 employees (according to LinkedIn data).
The fact that both businesses have taken the decision to cut staffing is indicative of an overall market downtrend currently. That said, CoinSwitch had onboarded 60 people since April, which would imply that the firm is expanding in other areas despite these customer service-related layoffs.
This may reflect the company’s plan to change strategic direction. Going forward, CoinSwitch intends to diversify its product offering and transition towards becoming a wealth tech platform.
CoinDCX layoffs
CoinDCX’s Co-Founders, Sumit Gupta and Neeraj Khandelwal, stated last week that they were making what was a very difficult decision to reduce the size of the team by 12% and that they regretted that talented team members would be moving on from the organization. The founders attributed the decision to market challenges and also pointed out the impact of the 1% Tax Deducted at Source (TDS) applied to local crypto exchanges. They clarified:
“These factors had a significant impact on our volumes and thus revenues. To adapt, we undertook several proactive measures, including direct cost optimization and investment in automation to drive efficiency and productivity.”
According to the announcement, the affected CoinDCX employees will receive a support package including severance pay equivalent to their full notice period, an additional month of salary, extension of health insurance, and other forms of assistance.
CoinSwitch was founded by Ashish Singhal, Govind Soni, and Vimal Sagar Tiwari in 2017. The company received the backing of leading venture capital firms such as Andreessen Horowitz (a16z), Sequoia Capital, Tiger Global, Paradigm, Coinbase Ventures, and Ribbit Capital. In 2021 it was recognized as India’s second crypto firm to reach unicorn status, following a $260 million Series C funding round that saw the company reach a valuation of $1.9 billion.
In 2022 India introduced a 30% tax on cryptocurrency gains, resulting in the exodus of numerous cryptocurrency service providers and a steep decline in crypto trading activity. The country has also implemented a 1% TDS for crypto exchanges, mandating that exchanges pay 1% on all crypto asset transfers.
