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How India’s Crypto Exchanges Are Holding On For Survival

Indian crypto firms like CoinDCX, CoinSwitch, and WazirX reveal how they’ll ‘hold onto dear life ‘ – literally – to survive today’s bear market.

As the bear market takes more victims, Indian crypto exchanges are feeling the pressure to stay afloat.

Indian crypto exchanges have been concerned for their chances of survival since February 2022, where the beginning of the month marked the nation’s announcement of its strict crypto tax framework: taxing 30% on crypto profits, and the controversial 1% tax deducted at source (TDS) on all transactions.

Ten days after the tax implementation, crypto trading volumes in India plummeted, some cases even seeing a drop of more than 70%. Soon, India’s government imposed a “shadow ban” that brought local payment processors to even cut off banking access to crypto exchanges.

At the time, local industry leaders cited going under a “period of pain”, but saw optimism, as “ultimately, technology always emerges, it always wins.”

As four months passed after the implementation of the 30% tax, India’s crypto industry advocacy body disbanded, marking a crypto dark age in India. Enforcement agencies were tasked to investigate at least 10 crypto exchanges under allegations for assisting foreign firms to launder money by means of crypto.

Then, the global crypto stage took notice of India, with industry leaders like Binance CEO Changpeng ‘CZ’ Zhao claiming that India’s massive crypto tax may “kill the industry” within the nation. 

And CZ may be right: by 2023, data reveals that crypto traffic in India shifted $3.8 billion in trading volume from local to international exchanges.

Despite India’s holding of the 2023 presidency for the Group of 20 (G20), and its prioritisation of bringing globally-coordinated rules for the crypto sector, the country itself is not showing positive signs for its local crypto sector.

Experts have called for such guidelines to be aligned with that of the global standard setter – the Financial Action Task Force (FATF) – which brought the government to establish regulations for virtual assets to also follow anti-money laundering rules. While it adds some legitimacy to the sector, its local crypto industry isn’t quite convinced to be optimistic about developments yet: as they do not have answers to what can happen next if India’s hawkish 30% tax regime remains.

Even so, India’s home-grown platforms are determined to survive.

In order to stay afloat, Indian crypto firms are cutting costs whenever possible, re-negotiating partner contracts, pausing employee pay-hikes, conducting lay-offs, while exploring new revenue models and rebranding themselves to make it out of today’s tough financial landscape. The goal? To extend their financial runways in the event they run out of money.

India’s top six crypto platforms – CoinDCX, CoinSwitch, WazirX, BuyUCoin, ZebPay and Giottus – all each have different lifespans of their runways, where some are even hoping to stretch themselves into the next bull market.

While CoinSwitch and ZebPay have not disclosed their financial runway timelines, the remaining platforms said their runways range from 21 months to even four years.



Predicted Runway Extension: Until early 2025 (approximately 2 years)

BuyUCoin is an early player in India’s crypto industry. Unfortunately having to lay off 10% of its workforce of 100, the crypto firm says that it has set up sister companies in Estonia and Singapore to expand business worldwide.

“By the end of 2024, we will see a good bull run,” said Atulya Bhatt, its co-founder. “Crypto is a seasonal market and every four years bitcoin goes up and down. It will take 10 years for crypto to become completely sustainable.”

“Since we have never raised funds, we can now, given interest from partners across the globe,” he said.


Predicted Runway Extension: Until 2027 (4 years)

CoinDCX and Okto co-founder Neeraj Khandeval says he’s betting big on Okto Wallet – a new DeFi (decentralised finance) wallet. Beyond that, CoinDCX is in the midst of diversifying and banking on its recent series D funding of $135 million.

“Our biggest bet is on our Okto Wallet. We believe DeFi will offer 10X value eventually as only 6.5 million DeFi customers exist, while there are 400 million crypto investors,” says Khandeval.

CoinDCX has shown to lead engagement between India’s lawmakers through the local industry policy advocacy body – emerging as a major player in India’s crypto industry after drama involving WazirX, thought to be leading India’s crypto policy engagement prior.

Its strategy, Khandelwal says, referring to WazirX, is “investing heavily in innovation and technology,” including hiring in the space “even now” as we “never over hired.”



Predicted Runway Extension: Not provided

“CoinSwitch has always been conscious of its expenses,” said Ashish Singhal, the company’s co-founder and CEO. “Today, we are proudly serving more than 19 million registered users, and are excited to grow and evolve with them by providing them with a diverse range of investment options, including fixed deposits (FD), mutual funds, Indian stocks, and more.”

CoinSwitch was a prominent victim of blights put on the crypto industry from taxes, the crypto winter, and government agency scrutiny. The firm’s properties were raided by Indian agencies in August 2022.

Previously known as ‘CoinSwitch Kuber’, the platform made a switch from being a crypto exchange to being a crypto investment platform.

While the administrative switch can’t guarantee Singhal to confirm CoinSwitch’s runway extension timeline, conditions are good, saying “our healthy runway gives us enough ammunition to invest in our long-term vision – to be a one-stop wealth-tech destination for Indians.”

Singhal adds that CoinSwitch has “strengthened its leadership team by hiring industry experts,” perhaps to navigate handling regulators, and sees the government’s push for the crypto industry to be subject to anti-money laundering laws as a “significant positive advancement.”



Predicted Runway Extension: Until March 2025 (21 months)

India’s biggest exchange by trading volume (with 15 million registered users) until recent events is determined to stretch their runway for at least 21 months, after a series of controversies.

Its future started to show signs of shakiness after its founder Nischal Shetty moved from India to Dubai to focus on a project late last year. Then, Indian government agencies started to raid properties tied to a WazirX director, in the midst of local crypto exchange investigations.

To add fuel to the fire, CP Zhao and Shetty quarrelled publicly – and still are quarrelling – over who truly owns the exchange.

The exchange was provoked to lay off 40% of its staff, giving it a 21-month-long runway, according to an inside source. According to the source, “employees who deserve pay hikes won’t be getting them,” indicating the state of operations of the firm.

WazirX is also buying time by including partner contract renegotiations in its survival strategy, instead of diversifying its product offerings. WazirX is committed to staying focused on crypto for the time being, adds the source.

“That’s what the founders enshrined into us,” the person said. “The idea is to survive because [the] Bitcoin halving is going to happen in May 2024 when, we hope, a bull run will come. By then, if things don’t break, we should be around to see it.”

A ‘bitcoin halving’ is when the total number of bitcoins that miners can potentially win in a round of block creation is halved – which happens roughly every four years. 

In addition, WazirX plans to “keep chipping away at costs constantly to extend the runway”, and attract money-making partnerships, like its recent partnership with tax solutions provider TaxNodes.



Predicted Runway Extension: Not provided

Known as one of India’s first crypto exchanges, the exchange has not offered its runway timeline.

But Chief Revenue Officer Nirmal Ranga says that ZebPay has support from an unnamed subsidiary in Singapore to protect the exchange when it loses customers, when the bear continues its course, or if things continue to worsen.

“Our internal revenue strategy is to increase the lending value of our customers and concentrate on user growth,” Ranga said. “We are also trying to create interest for institutional investment.”

Ranga says that ZebPay follows two ways to survive: “use profits made during previous bull runs or use funds from marketing partnerships or investors,” citing its experience from surviving crypto’s early ups and downs.

ZebPay also has a partnership with TaxNodes, like WazirX.



Predicted Runway Extension: Until early 2025 (2 years)

While Giottus is a lesser-known Indian exchange, its staking service and multilingual platform are popular amongst customers.

Giottus also separates itself from the crowd as it announced it will provide customers with proof of its reserves, while its rival exchanges remained silent.

Vikram Subburaj, Giottus co-founder and CEO, says that “under the current conditions”, the budding crypto exchange will have a two year runway.

“Our focus is completely on bringing in operational excellence, building your products right, drastically cutting marketing and acquisition expenses, and reducing perceived risks associated with exchanges,” says Subburaj, on Giottus’ strategy. During bull runs, Subburaj notes that Giottus had a small marketing team.

Much like its cohorts ZebPay and WazirX, Giottus also has a partnership with TaxNodes.

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