CoinDCX points finger: Tax policy, bear market behind layoffs


  • CoinDCX has laid off 12% of its workforce due to financial strains.
  • India’s strict crypto tax regulations, introduced in 2022, significantly impacted trading volumes and revenues for crypto exchanges.
  • The Indian crypto tax mandates a 1% tax at source and a 30% tax on crypto profits.

The storm of layoffs that has swept through the crypto industry has now descended upon CoinDCX, the renowned Indian crypto exchange.

This week, the company announced a significant reduction in its workforce, shedding 12% of its employees. What’s driving this drastic measure? A combination of challenging tax regulations and an unforgiving bear market, according to the exchange’s top brass.

Policies and Profits: India’s Tax Turbulence

CoinDCX’s founders, Sumit Gupta and Neeraj Khandelwal, didn’t beat around the bush about the reasons for these job cuts. India’s formidable crypto taxation rules introduced in 2022 are certainly a thorn in their side.

Investors now must part with a 1% tax right at the source, and then another 30% from any profit they make off their crypto investments. To say this has thrown cold water on the industry would be an understatement.

After this legislation came into play, several exchanges, including CoinDCX, watched in disbelief as their trading volumes plummeted, in some cases by as much as 70%.

Not surprisingly, the ripples of this regulation have affected CoinDCX’s bottom line. Revenue streams have taken a hit, forcing the exchange into cost-cutting mode, optimizing where possible, and investing in automation to try to salvage their operations.

Fast forward to early 2023, and any hopes that the tide might turn during the national budget discussions were dashed. The taxing 30% profit levy and the 1% TDS remained unchanged. To add salt to the wound, not paying up the TDS could now see offenders behind bars for up to seven years.

Layoff Trend: Not Just CoinDCX’s Dilemma

While CoinDCX’s woes are significant, they’re not the only ones fighting to stay afloat in these stormy waters. Major players in the crypto exchange market, both in India and abroad, are reeling.

Coinbase, for example, started 2023 on the back foot, letting go of a staggering 950 employees in a desperate attempt to reduce costs. Binance, another titan in the field, has also been offloading staff throughout the year.

Even though they’ve acknowledged the layoffs, the exact number of employees shown the door remains undisclosed. Binance.US didn’t fare much better, having to cut its workforce after a lawsuit from the US Securities and Exchange Commission.

On a brighter note – and yes, there are still glimmers of hope in the crypto world – the sector continues to attract talent. Take Guillaume Poncin, for instance, once the head honcho of Web3 and crypto at Stripe.

He has recently taken up the mantle of head of engineering at Alchemy, a web3 development platform. Poncin seems to be optimistic, believing he can influence and boost crypto adoption through Alchemy.

He recognizes the current challenges in the Web3 domain but remains confident that things will improve. It’s clear that the crypto realm is undergoing a transformation.

Exchanges, once thought to be unshakeable pillars of the industry, are now showing cracks. And while players like CoinDCX grapple with policies and market conditions, others like Alchemy are forging ahead, aiming to innovate.

What’s next for CoinDCX remains to be seen, but one thing’s for sure: In this volatile and unpredictable world of crypto, it’s adapt or perish.

Disclaimer: The information provided is not trading advice. holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

Share link:

Jai Hamid

Written by Jai Hamid

Jai Hamid is an enthusiastic writer whose current area of interest is the blockchain sector. Whenever she is not reading or writing, you can find her tending to her plants in the garden. She strongly believes that crypto is going to transform the world for the better.