Bosses at crypto tax reporting platform Koinly say they are already letting staff go and will be shutting down its London office in the new year.
The company’s founder is pointing the finger at the so called ‘crypto winter’ and prolonged bear market with the start-up tax reporting application facing a 14 per cent layoff which will affect 16 members of staff.
The end-of-year move is a deeply contrasting change in fortunes to the start of 2022 which saw Koinly enjoy an enthusiastic 225 per cent expansion.
Offices in Sydney will remain open and become the firm’s headquarters, while the London office will close in 2023. No statement has been made about Koinly’s Canadian base in Toronto.
“We are taking measures to ensure we’re as lean as possible as we make our way through the crypto winter,” said Robin Signh, Koinly’s founder and Chief Executive Office.
“While change is an unavoidable part of business, it’s been a sad week at Koinly as we have had to let go of several of our colleagues.”
In a company-wide statement, Koinly’s management team said the job losses to its global team were a bid to combat the challenging conditions facing the cryptocurrency market and economy at large.
Mr Singh explained the cuts were a response to the intensifying bear market, compounded by the collapse of major cryptocurrency exchange FTX in mid-November 2022.
“As a crypto tax company, what’s hurting us more than the actual crypto downturn is the lack of awareness crypto investors have around filing their crypto losses,” he added.
“We are seeing fewer people reporting crypto on their tax returns, mostly because there are a lot of losses this year. However, investors are generally unaware that filing losses on their tax returns benefits them in the long run, as losses can be used to offset gains in future years.”
Founded in 2018, Koinly is used by thousands of cryptocurrency investors, accountants and blockchain businesses and is the tax partner for a number of cryptocurrency exchanges.