Fallout Of Crypto Winter: India’s WazirX Lays Off 60+ Employees

The beleaguered Indian crypto exchange WazirX has laid off as much as 40% of its workforce amid adverse economic conditions exacerbated by an ongoing crypto winter and India’s anti-cryptocurrency stand.

According to a report by CoinDesk, the crypto exchange laid off around 50-70 employees of its total workforce of 150. The employees let go were told by the company on Friday (September 30) that they would receive severance pay for 45 days.

WazirX also told the employees that they would not be required to report to work, and their accesses were withdrawn.

When reached out, the crypto exchange confirmed the development. A WazirX spokesperson told Inc42, “Our priority is to be financially stable and to continue serving our customers. To achieve this, we’ve had to reduce our staff to weather the crypto winter.”

The report added that the startup has cut down the workforce across customer support, HR and other teams. WazirX has also let go of the entire public policy and communication team.

The spokesperson added, “The Indian crypto industry has had its unique problems with respect to taxes, regulations and banking access. This has led to a dramatic fall in volumes in all Indian crypto exchanges.” 

The crypto exchange joins the growing list of Indian startups that have laid off employees in 2022. According to Inc42’s ‘Indian Startup Layoff Tracker‘, more than 12,586 employees have been laid off by 42 startups so far in 2022.

According to CoinGecko data, WazirX daily trading volumes have declined drastically over the last year. From $543 Mn on October 28, 2021, the crypto exchange’s daily trading volume reduced by 99.77% to $1.2 Mn today (October 3).

Amid increasing regulatory pressure on Indian crypto exchanges and startups, India fell to the fourth spot on the Global Crypto Adoption Index. The high taxation and the uncertainty around the future of crypto have prompted the growth plateauing in the country.

Troubles Mount For WazirX

WazirX has recently endured a lot of trouble, with the layoffs coming as a culmination of that.

After India’s government implemented a strict crypto taxation regime, the trading volumes at WazirX plunged drastically. With the government implementing a ‘shadow ban’ on crypto exchanges using UPI, the trading volumes suffered further.

Founded in 2017 by Nischal Shetty, Sameer Mhatre and Siddharth Menon, WazirX was acquired by Binance in November 2019. However, in August this year, Binance CEO Changpeng Zhao said that Binance never acquired the Indian crypto exchange, sparking a public spat between Shetty and Zhao on Twitter.

The timing of Zhao’s was particularly noteworthy as his comments came on the same day as the Enforcement Directorate (ED) froze WazirX’s assets worth INR 64.67 Cr in connection with a money laundering case. 

While the ED has since unfrozen its assets, WazirX still finds itself on the watchdog’s radar in connection with the fraudulent loan apps case, along with almost all of the crypto exchanges operational in India. 

Apart from the ED, WazirX is also under investigation for alleged tax evasion. The GST Mumbai East Commissionerate detected GST evasion of INR 40.5 Cr at the crypto exchange in January this year.