WazirX, one of India’s most prominent digital asset exchanges, is laying off 40% of its workforce, multiple reports from India have revealed.
The exchange has had a tough year, with its trading volume dipping by 99% from its one-year high as the “crypto winter” took its toll. This decline was compounded by a spat with Binance over ownership of WazirX’s parent company and investigations by Indian authorities that saw some of its assets frozen for weeks.
In a statement discussing the layoffs, the exchange stated, “The crypto market has been in the grip of a bear market because of the current global economic slowdown. 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 management further expressed confidence in the exchange’s ability to bounce back, drawing parallels between this year’s bear market and the 2018 winter.
“This situation is similar to the trying times the industry faced in 2018; at that time, we doubled down and built our innovative P2P engine. The crypto industry operates in cycles, and the bear market is inevitably followed by a spectacular bull market. We will continue to focus on our customer needs and continue to build. We are confident that we will come out stronger when the bull market arrives.”
There are marked differences between this year and 2018 for WazirX, however. Back then, the exchange was only a year old and still trying to find its feet. Now, it’s one of India’s largest exchanges.
Even more significantly, the “crypto winter” isn’t the only challenge the exchange faces this year. CoinGeek reported that it’s still unclear who owns WazirX after the founder Nischal Shetty engaged in a public spat with Binance’s Changpeng Zhao over ownership of the exchange’s parent company.
In 2019, Binance claimed to have purchased WazirX, and since then, the Indian exchange has been known to be a Binance-owned firm. However, CZ denounced the exchange a few months ago, claiming that the acquisition deal fell through.
And then, there are the investigations into the exchange by Indian authorities. The country’s Enforcement Directorate has been probing WazirX over its role in a money laundering scheme linked to Chinese loan apps. In early August, ED froze the exchange’s bank accounts and only unfroze them in mid-September.
‘We were told our jobs were safe’
According to sources in India, the exchange gave the pink slip to staff members across its HR, customer support, and other departments. It also laid off its entire public policy and communication team.
For most employees, the layoffs caught them by surprise.
“The company was never really forthcoming or transparent with its financial position, either when it was doing well or now,” one of the employees who was laid off revealed.
It didn’t help that the exchange had assured them that their jobs were safe just a few months ago. According to one source, following the spat between Binance chief executive officer CZ and WazirX founder Shetty, many employees were uneasy and worried about their future at the exchange. The conflict also made traders jittery, and data shows that trading volume dipped by over 50% in the days that followed, further adding to the employees’ concerns.
Two of those who lost their jobs say that they had been assured all was well.
“During one all-hands meeting after the online spat, we were told we have decent reserves, so we are financially safe.”
Data by CoinGecko indicates that on October 28 last year, the exchange hit a one-year high of $579 million in daily trading volume. Since then, it has steadily declined, and in the past 24 hours, it recorded just over $1 million in trading volume, a 99.8% slump.
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