Indian exchange WazirX has laid off several employees, the company said in a statement shared with CoinDesk on Saturday.
50 to as many as 70 employees or 40% of the exchange's workforce of 150, were laid off, three sources familiar with the matter told CoinDesk. The laid off workers were told on Friday they would be paid for 45 days, they would not be required to report for work henceforth and their accesses were withdrawn simultaneously.
"The crypto market has been in the grip of a bear market because of the current global economic slowdown," WazirX said in a statement on Saturday. "The Indian crypto industry has had its unique problems with respect to taxes, regulations and banking access. This has lead to a dramatic fall in volumes in all Indian crypto exchanges."
"As India's No 1. exchange, our priority is to be financially stable and to continue serving our customers," the company said. "To achieve this, we've had to reduce our staff to weather the crypto 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."
One of the sources said "the workforce has been cut from several departments including customer support, HR, and other departments. Managers, Analysts, Associate Managers/Team leaders were among those laid off." The entire public policy and communication team was fired, according to another employee who lost his job.
"The company was never really forthcoming or transparent with its financial position, either when it was doing well or now," said one of the WazirX employees who lost his job "abruptly" on Friday.
WazirX daily trading volumes have been steadily declining from a one year high of 478 million on October 28, 2021 to 1.5 million on October 1, 2022, according to CoinGecko data. Trading volumes on some days have been lower than a million and "this is not enough to support operations," the sources said.
The decline in trading volumes began shortly after India's implementation of harsh crypto tax laws in March, 2022, when WazirX Co-Founder Nischal Shetty told CoinDesk "we have entered a period of pain."
In recent days, the Indian exchange has been faced with a slew of problems including an online spat between Shetty and Binance CEO Changpeng Zhao about whether Binance is the parent company of the Indian exchange. Daily trading volumes were around 5 million around the time of the spat but after, its volumes dropped to less than 2 million, according to CoinGecko data.
"During one all hands meeting after the online spat we were told we have decent reserves so we are financially safe," two employees who were laid off said.
WazirX has also been a target of a money laundering investigation launched by India's Directorate of Enforcement, which included a raid against one of WazirX's directors.
Read More: WazirX Co-Founder Nischal Shetty Speaks Out on Spat With Binance CEO