Purple Pay’s cofounder Saumya Saxena said that the decision to shut down the operations stemmed from the realisation that compliant transactions were not a priority for the majority of projects
He attributed the challenging landscape to excessive VC-funded players with significant resources, contributing to market saturation
The founders will make Purple Pay an open-source so that anyone can use and build on top
Joining the growing list of Indian startups who have been winding down their businesses amid macroeconomic challenges, Web3 startup Purple Pay has shut down its operations within a year of its launch.
Founded in January this year, Purple Pay is a regulatory-compliant payment protocol using blockchain to facilitate cross-border transactions. It addresses regulatory issues with a KYC-compliant protocol, incorporating ZK-enabled decentralised identity to meet global anti-money laundering regulations.
The merchant offering enables businesses to accept crypto payments in a compliant manner, tapping into the expanding crypto economy.
“After 12 months of building Purple Pay, we have decided to shut it down. Knowing when to shut shop is the hardest part,” cofounder Saumya Saxena announced in a LinkedIn post.
Saxena said that the decision to shut down the operations stemmed from the realisation that compliant transactions were not a priority for the majority of projects.
Additionally, he highlighted the predominant use of cryptocurrency for investment/speculation rather than transactions, resulting in a limited market for purchase-oriented users.
Saxena attributed the challenging landscape to excessive VC-funded players with significant resources, contributing to market saturation. In light of these factors, the decision was made to cease operations.
“We spent so much time building product and understanding ZK KYC only to find there’s very limited demand for it from our users – RWA clients and DeFi projects. I still believe that the compliance narrative will fly eventually and that the only way for crypto to go mainstream would be on the back of regulatory clarity,” he added.
The founders said they would make the Purple Pay platform open-source so that anyone can use and build on top of it.
The startup was also part of the Sony Astar incubation programme, and generated $15K revenue from a $1.5 Mn transaction, securing a $10 Mn LOI for additional sales, Saxena claimed.
The startup also received over $70K in grants/hackathon rewards from entities like Polygon, Wormhole, 0x, Eth India and Jump Pit.
Amid macroeconomic pressure and funding crunch, the year 2023 has seen 16 startups shutting their shops or closing down a segment, with ZestMoney being the latest inclusion to the list. The fintech startup will wrap up operations by the end of December and lay off its entire workforce of 150 employees.
Among other significant shutdowns, CarTrade Technologies recently shut down the auto sales division of its acquired business – OLX or Sobek Auto India Pvt. Ltd. Short video platform Tiki, vernacular content platform Bluepad, coworking space provider Friyey, crypto startup Flint Labs are among some startups which winded down their business this year.