Tiger Global-backed crypto startup CoinSwitch has laid off 44 employees from its customer support team in August, citing redundancy in roles as customer queries have gone down amidst drop in crypto trading volumes. This comes less than a week after peer CoinDCX laid off about 12 percent of its employees.
However, sources in the know also said that there have been layoffs in the operations team too.
Responding to Moneycontrol’s queries, a CoinSwitch spokesperson said, “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. This impacted the roles of 44 members of our customer support team, who voluntarily resigned from their roles after a detailed discussion with their managers earlier this month.”
“Over the last year, many support team members have been absorbed into other functions based on the suitability of their skills for the other roles. We are extending all our support to the impacted employees. As and when volumes grow and we open new roles, we will be happy to welcome back those impacted,” the spokesperson added.
This comes at a time when the crypto industry in India is grappling with regulatory uncertainty, high taxation through 30 percent tax on gains from virtual digital assets (VDAs) and 1 percent TDS charged on every crypto transaction of over Rs 10,000 on exchanges, causing liquidity issue. This has led to a significant drop in trading volumes in the tune of over 85-90 percent.
CoinSwitch is one of the two crypto unicorns from the country and is also the highest valued. It was last valued at $1.9 billion in 2021 having raised funds from Coinbase Ventures, Andreessen Horowitz (a16z), Tiger Global, Sequoia Capital and Paradigm among others.
More layoffs
Impacted employees who didn’t want to be named, said the layoffs also happened in the operations team.
“My access was suddenly taken away without prior notice. Several positions were impacted including team leads, agents, support staff, senior managers and quality analysts too. We have been offered severance pay of up to four months and were asked to leave earlier in August after having a chat with the HR person on the same day,” said one of the employees seeking anonymity.
“CoinSwitch has been asking people to leave on a quarterly basis depending on their performances. Though this one was not performance related. Some have been leaving voluntarily too,” the employee added.
Later, CoinSwitch denied having separate operations team, clarifying that the startup has a flat "organizational structure with minimal hierarchy."
"As an example, our Head of Customer Support directly reports to the COO. Our Customer Support team is also sometimes referred to as Customer Operations team. There is no separate operations team for our Virtual Digital Assets Business," CoinSwitch's spokesperson explained.
The spokesperson also added, "We would also like to clarify that we have follow a half yearly appraisal cycle and not a quarterly one."
Another source close to CoinSwitch and didn’t want to be named said that the company continues to hire and are connecting with staffing partners to field offers for the roles required.
“Over 60 people were hired since April. They still have a funding runway of five years,” the person said.
On the business front, CoinSwitch is gearing up to expand its offerings outside crypto and build a wealthtech platform. Co-founder and CEO Ashish Singhal told Moneycontrol last month that it is talks with the concerned regulators to launch at least seven financial products by the end of this year including fixed deposits, mutual funds, bonds, stocks and exchange-traded funds.
(This article was updated to include CoinSwitch's statement on its operating structure.)
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