Cryptocurrency exchange Unocoin lays off more workers, blames crackdown for woes

Bengaluru-based cryptocurrency exchange Unocoin has laid off half of its remaining workforce even as the company, along with its once-red-hot virtual currency peers, hopes for a reprieve from the regulatory crackdown.

Talking to TechCircle, Unocoin co-founder and chief executive Sathvik Vishwanath said the company has trimmed down the team size again to 14 from 28 as its current scope of operations doesn’t require a larger team.

The firm had an all-time high of over 100 employees back in February 2018 before the government crackdown on digital currencies.

A lot of cryptocurrency companies operating in India have been suffering from an order by the Reserve Bank of India (RBI) in April last year that asked all banks to stop transactions with any companies dealing in cryptocurrencies.

Even before the RBI had announced its diktat, Union finance minister Arun Jaitley had said that while the government would welcome blockchain as a technology, it would still not accept cryptocurrency as legal tender. 

The RBI's directive also saw a few companies and crypto traders move the Delhi High Court and the Supreme Court to challenge the ban.

While the court has not yet reached a verdict on the issue, several cryptocurrency exchanges such as Zebpay have had to stop trading operations.

Vishwanath said, “We understand that it is a time-consuming process for clearer regulatory framework to emerge, for any new segments.”

After a brief hearing on 29 March 2019, the apex court scheduled the next hearing to the second week of July. Earlier in February, the court had extended the deadline by four weeks for the central government to draft blockchain and cryptocurrency regulations.

The finance ministry and the RBI were reportedly approaching the final stages of drafting a regulatory framework for legalising cryptocurrencies in the country. However, an official decision on the matter will likely only arrive after the upcoming general elections.

Unocoin

Unocoin was co-founded in December 2013 by Vishwanath, Sunny Ray (president), Abhinand Kaseti (marketing chief) and Harish BV (finance chief).

The company raised seed funding of $250,000 in August 2014 from SecondMarket founder Barry Silbert’s Bitcoin Opportunity Corp and a pre-Series A investment of $1.5 million led by early-stage investor Blume Ventures. The following also participated in the pre-Series A round: Mumbai Angels, ah! Ventures and international investors such as Digital Currency Group, Boost VC, Bank to the Future and FundersClub.

In October 2018, Unocoin co-founder Harish BV was arrested for running an illegal bitcoin trading kiosk.