Indian crypto exchanges are in survival mode, chopping prices wherever attainable, re-negotiating companion contracts, suspending worker pay-hikes, conducting lay-offs, exploring new income fashions and rebranding themselves, all in an effort to increase their monetary runways – once they run out of cash.

CoinDesk spoke to workers and senior executives at six outstanding Indian crypto platforms – CoinDCX, CoinSwitch, WazirX, BuyUCoin, ZebPay and Giottus. Several of those exchanges mentioned their runways vary from 21 months to 4 years, which might, if true, possible take them into the subsequent bull market. CoinSwitch and ZebPay didn’t share their monetary runway timelines.

The survival of India’s crypto exchanges has been a priority since Feb. 1, 2022, when the nation introduced stiff taxes – a 30% tax on crypto earnings and the extra controversial 1% tax deducted at supply (TDS) on all transactions. At the time, native {industry} leaders mentioned they’d entered a “period of pain” however that “ultimately, technology always emerges, it always wins.”

Signs of a crypto “brain drain” emerged inside weeks. Ten days after the taxes have been applied, crypto buying and selling volumes plummeted, in some circumstances greater than 70%. India’s authorities then imposed a “shadow ban,” which noticed native payment processors cut off banking access to crypto exchanges.

Four months into the imposition of the 30% tax, the industry’s advocacy body was disbanded and enforcement agencies were investigating at least 10 crypto exchanges for allegedly assisting foreign firms launder money via crypto. Soon, the world took note and global industry leaders such as Binance CEO Changpeng ‘CZ’ Zhao claimed India’s taxes would most likely “kill the industry” within the nation.

By 2023, knowledge revealed crypto site visitors within the nation continued its nosedive and that Indians had moved greater than $3.8 billion in trading volume from local to international crypto exchanges.

India, as president of the Group of 20 (G-20) in 2023, has prioritized framing globally coordinated rules for the crypto sector. As a result, experts say, it needed to align with the guidelines of the global standard setter, the Financial Action Task Force (FATF) on virtual assets by including Indian crypto business under anti-money laundering rules.

This move, which adds some legitimacy to the sector by way of setting up regulatory oversight, has fueled a little optimism among Indian exchanges on the local industry’s longevity, even if the nation doesn’t change its tax regime, according to several industry officials. But they don’t have an answer to what happens if the tax regime stays the same – and are taking various steps to guard against such a scenario.

Indian crypto exchange CoinDCX is weathering the storm by diversifying and banking on its recent series D funding of $135 million.

“We have a runway of four years,” under present conditions, said Neeraj Khandelwal, co-founder of CoinDCX and Okto. “Our biggest bet is on our Okto Wallet. We consider DeFi [decentralized finance] will supply 10X worth finally as solely 6.5 million DeFi clients exist, whereas there are 400 million crypto investors.”

CoinDCX has been leading engagement with lawmakers through the industry’s policy advocacy body, Khandelwal said, exemplified by a recent event, and has emerged as a major player in the Indian crypto industry after recent setbacks faced by WazirX, who ostensibly led the industry in policy engagement before CoinDCX.

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

The events have seen the exchange lay off 40% of its staff. Yet, the exchange has a 21-month runway, said an employee who was not authorized to speak publicly about the company. “But employees who deserve pay hikes won’t be getting them,” he said.

WazirX’s survival strategy is to renegotiate contracts with partners including software vendors, the person said. Unlike some other exchanges, WazirX will not be diversifying. It will stay focused on crypto.

“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.” The Bitcoin halving is when the total number of bitcoin that miners can potentially win is halved. This happens roughly every four years.

WazirX also plans to “keep chipping away at costs constantly to extend the runway” and capitalize on its 15 million registered users to attract lucrative partnerships, like a recent one with tax solutions provider TaxNodes.

CoinSwitch shed “Kuber” from its previous name, CoinSwitch Kuber, and pivoted from being a crypto exchange to a crypto investment platform.

This occurred as India’s taxes, the crypto winter and the ire of Indian agencies all hit the platform hard. CoinSwitch properties were raided by Indian agencies in August 2022.

“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.”

Without giving a timeline on its runway, Singhal said “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 also said his company has “strengthened its leadership team by hiring industry experts,” presumably to navigate regulators, even if he added that the recent step to bring crypto businesses under anti-money laundering rules was a “significant positive advancement.”

One of India’s first crypto exchanges, ZebPay, also refused to share a timeline on its runway. But Chief Revenue Officer Nirmal Ranga said it had support from an unnamed subsidiary in Singapore, in the event it loses customers, the bear market extends or things generally go from bad to worse.

“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.”

Given ZebPay’s team has seen crypto’s early up and down cycles, it follows two ways to survive – “use profits made during previous bull runs or use funds from marketing partnerships or investors,” Ranga said. Like WazirX, ZebPay also has a partnership with TaxNodes.

Another early player in the Indian crypto space, BuyUCoin, said its runway extends until early 2025.

“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.”

Nevertheless, BuyUCoin had to lay off 10% of its 100 people workforce, Bhatt said. At the same time, BuyUCoin has set up sister companies in Estonia and Singapore as part of a global expansion plan.

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

After FTX’s implosion, crypto entities scrambled to publish proof of reserves. Giottus, a lesser-known Indian exchange recognized for its staking service and multilingual options within the nation, said it might present clients with proof of reserves, whereas rivals remained silent.

“We have a two-year runway under the current conditions,” mentioned Vikram Subburaj, Giottus’ co-founder and CEO. “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.”

In phrases of workers, Subburaj mentioned Giottus had a compact advertising crew even throughout bull runs and like others, it partnered with TaxNodes to enhance operational help.