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CoinDCX is the most recent cryptocurrency firm to reduce its workforce as it seeks to navigate market difficulties. The Indian crypto unicorn, supported by Coinbase Ventures, attributed the decision to the extended bear market and the effects of TDS on local exchanges, resulting in a layoff of 12% of its staff, which amounts to 71 employees out of a total of 590.
This action follows an internal reorganization that the company underwent earlier this year.
CoinDCX Lay Offs
Established by Neeraj Khandelwal and Sumit Gupta in 2018, CoinDCX disclosed that it is implementing several proactive strategies, including direct cost management and investments in automation, aimed at improving efficiency and productivity.
The platform has also realigned various initiatives/products to better fit its long-term business objectives by resizing certain teams and directing the business towards profitable and sustainable growth.
The founders further indicated that there are specific positions that do not align with the current business focus and added,
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“We’ve tried our utmost to explore various alternatives, but current market realities compel us to take some tough decisions. We believe that this is the right thing to do for the business. We understand the emotional toll of this decision, and we bear its weight, both in responsibility and in emotion.”
CoinDCX attained “unicorn” status in August 2021 after raising $90 million in a Series C funding round. The crypto exchange further boosted its valuation to over $2 billion by securing an additional $135 million last April.
India Crypto Taxation
India has imposed substantial taxes on cryptocurrencies, which include a 30% tax on profits derived from digital assets and the more controversial 1% Tax Deducted at Source (TDS) on all transactions starting from February 1, 2022.
The introduction of TDS, along with the global decline in the crypto market, has negatively impacted trading volumes and, consequently, the revenue of many crypto companies in the nation, including CoinDCX.
The Indian government reported collecting only about $7.4 million in TDS on crypto transactions during the period of July-December 2022. As a result, expectations were elevated that the finance ministry would lower the tax rate to a range of 0.05% to 0.1%, in line with the industry’s request. However, the authorities did not provide any such relief.
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