Facing funding crunch due to crypto ban, Unocoin executes mass layoffs

Unocoin, a cryptocurrency business based in Bengaluru has been tumbling downhill since last October when its co-founders, Harish BV and Sathvik Viswanath, were arrested in the case of Bitcoin kiosk (ATM) that the company had installed without gaining any permission from the authorities.

The company was involved in asking for PAN ID and bank details from customers at the kiosk when banks had been strictly banned from allowing any transaction related to virtual currencies. This had made the Bitcoin ATM even more problematic.

When the arrest took place, founders were facing multiple charges including computer-related charges, conning, and forgery.

Before all of this had happened, the company had a workforce of more than 100 people. However, in the latest set of events it turns out that the company has laid off more than half of its people and the number of people remaining in the offices is down to a low of 14 employees, reports ET.

This is because of one reason - the uncertainty in India around the use of cryptocurrency. When the court had banned the involvement of banks in crypto transactions, several people running businesses tendering this virtual money had protested against the decision, but the Supreme Court hearing for the same is still pending after being deferred to July.

For Unocoin, this means no follow on investment as ROI for investors becomes a sketchy possibility in the segment. Initially, it had raised $1.5 million from Blume Ventures and Bitcoin Capital. But due to a lack of follow on investment, sustaining around 100 employees while aiming to run the business till July hearing becomes a difficult task.

Hence, the layoffs. Most business that had started shop in India to sell cryptocurrency had given up on the idea after the RBI ban and the uncertainty around hearing assessing the non-feasibility of the venture. Unocoin has no such plans. It aims to sustain its business until July to live the possibility of a favourable outcome.