Startup Deep Dive : CoinSwitch — a 30% tax cut its revenue by four-fifths in a year

In the July-September 2025 quarter, CoinSwitch said it had turned profitable at the group level for the first time. Only months earlier, its FY25 annual accounts had shown a net loss of ₹333.1 crore ($37.6 million) — more than double the previous year’s loss — even as revenue from operations nearly tripled to ₹129.5 crore.

That contradiction is the story. CoinSwitch survived a 2022 tax shock that wiped out four-fifths of its revenue in a single year, then got dragged into the fallout of a hack at a rival exchange it did not run, and still ended up crossing 2.5 crore registered users by September 2025 — the first Indian crypto platform to do so, as per company data. Whether the quarterly profit claim marks a genuine turn or a pause in an expensive user-recovery programme is the question this piece tries to answer.

Quick facts

What they do

CoinSwitch is a retail app for buying, holding and trading cryptocurrency, built for Indians who want exposure to bitcoin, ether and a few hundred other tokens without learning how an order book works. Under its parent, PeepalCo, the crypto app sits next to a separate stockbroking app called Lemonn, launched in April 2024 for equities, aimed at first-time investors moving from savings accounts into markets. The pitch across both products is the same: strip out the jargon, offer one clean interface, and let a first-generation investor put money into an asset class their parents never touched. CoinSwitch says it had crossed 2.5 crore (25 million) registered users by September 2025, which it calls the first time an Indian crypto platform has reached that scale, with daily average spot trading volumes up 2.4 times over the course of 2025.

The origin

Ashish Singhal, Govind Soni and Vimal Sagar Tiwari were computer science engineers who had known each other for years and had a track record of winning hackathons run by Sequoia, Google and Amazon before they built CoinSwitch. The founding problem was mundane and specific: in 2017, the same cryptocurrency traded at noticeably different prices across different exchanges, and moving coins between them to arbitrage that gap, or simply to get the best price, was clunky and confusing for an ordinary trader. CoinSwitch launched as an aggregator that compared prices across exchanges and routed a trade to wherever it was cheapest, rather than as an exchange itself. According to the founders’ own account, within a month of its public launch the platform was already routing about a million dollars a day in gross transaction value, a signal strong enough that Sequoia Capital came in with the startup’s first institutional backing.

The struggle years

CoinSwitch’s roughest years were not about a product failing to find users; they were regulatory and reputational. The first shock landed in the Union Budget of February 2022, when the government introduced a flat 30% tax on gains from virtual digital assets, effective 1 April 2022, with no provision to offset losses from one crypto position against gains from another, followed by a 1% tax deducted at source (TDS) on transfers above a threshold, effective 1 July 2022. Visits to India’s major crypto exchanges, including CoinSwitch, WazirX, CoinDCX and ZebPay, fell roughly 80% between February and October 2022, as reported by CoinDesk citing exchange traffic data, and industry reports described further declines after the TDS rule took hold in July. CoinSwitch’s own numbers reflect the damage: revenue from operations fell from ₹248.6 crore in FY22 to ₹45.6 crore in FY23, a drop of about 81.7%, as per Entrackr’s review of the company’s regulatory filings. Weeks after the tax rules landed, in August 2022, India’s Enforcement Directorate carried out searches at CoinSwitch’s premises over alleged foreign exchange law violations; CEO Ashish Singhal said publicly that the company was “fully cooperating” with authorities, as reported by CoinDesk. By August 2023, with volumes still depressed, CoinSwitch laid off 44 employees, about 8% of a workforce that stood near 519 at the time, citing role redundancy, per Business Standard’s report. A second, unrelated shock arrived in July 2024, when rival exchange WazirX suffered a hack of roughly $235 million, later attributed by investigators to the Lazarus Group, that froze withdrawals across the platform. CoinSwitch was not the exchange that was breached, but it held institutional exposure to WazirX and told Decrypt that it lost access to a meaningful share of assets stuck there, forcing it into court to recover funds and into a costly user-facing recovery programme that shows up directly in its FY25 accounts.

The turning point

If there is one event that reset CoinSwitch’s business, it is the 2022 tax overhaul rather than any single funding round. Before it, in FY22 (year ended March 2022), CoinSwitch reported revenue from operations of ₹248.6 crore against a net loss of ₹513.1 crore, a business still scaling on the back of a bull run in crypto prices and a fresh unicorn valuation. After it, in FY23 (year ended March 2023), revenue from operations had collapsed to ₹45.6 crore — a fall of about 81.7% — even though the net loss actually narrowed to ₹385.4 crore as the company cut costs hard, according to Entrackr’s analysis of its filings. The tax did not just squeeze margins; it changed the arithmetic of active trading itself. A 1% TDS on every transfer, non-refundable in practice for high-frequency traders, made short-term trading uneconomical on Indian exchanges, and volumes migrated to peer-to-peer routes and offshore platforms instead. CoinSwitch has never fully returned to its FY22 revenue level in the years since, even as its user count has kept climbing.

The money behind it

CoinSwitch raised its funding in four disclosed rounds and around $300 million in total, per Inc42’s funding tracker. It started with roughly $1.5 million in seed funding around 2018, then took $15 million in a Series A in October 2020 from Ribbit Capital and Paradigm, who brought crypto-specific investing expertise that domestic Indian venture funds did not yet have. Tiger Global led a $30 million Series B in April 2021, valuing the company at more than $500 million and signalling that a growth-stage global investor believed Indian retail crypto adoption was about to scale quickly. The defining round came in October 2021: a $260 million Series C co-led by Andreessen Horowitz (a16z) and Coinbase Ventures, with Ribbit Capital, Tiger Global and Paradigm also participating, that valued CoinSwitch at $1.9 billion and made it India’s second crypto unicorn, as reported at the time by both TechCrunch and Axios. a16z and Coinbase’s participation mattered beyond the cheque size: it was Andreessen Horowitz’s first India investment and gave CoinSwitch a direct line to two of crypto’s most influential global investors just as Indian retail interest in the asset class was peaking. The company has not disclosed a new priced round since, and its $1.9 billion valuation, more than four years old as of September 2026, predates the tax shock, the WazirX-linked losses and the pivot into stockbroking through Lemonn — none of which has been tested by a fresh mark from investors.

How it makes money

CoinSwitch earns primarily on trading activity, not on holding customer assets. Spot trading fees run on a tiered maker/taker schedule, from about 0.04% to 0.40% depending on a user’s trailing 30-day trading volume across nine volume tiers, with futures trading charged at flat rates of roughly 0.02% for makers and 0.05% for takers, as listed on the company’s own published fee schedule. On top of visible fees, like most retail crypto apps, CoinSwitch also earns from the bid-ask spread built into the buy and sell prices it quotes, rather than charging a separate visible commission on every trade — a mechanic that is easy for a casual investor moving in and out of a position to underestimate. Deposits and withdrawals themselves are not fee-bearing line items for the company. The part people get wrong is assuming a “zero brokerage” headline number captures the full cost of trading; the spread and the tiered fee schedule both scale with how often, and how large, a user trades, so CoinSwitch’s revenue is structurally tied to trading frequency and market volatility rather than to assets under management, which is precisely why the 2022 tax rules, aimed at discouraging frequent trading, hit its top line so directly.

The numbers

The table below tracks four fiscal years. FY22 and FY23 figures are for the CoinSwitch entity as reported before the PeepalCo group restructuring; FY24 and FY25 figures are for parent PeepalCo, which by then also consolidated Lemonn’s stockbroking revenue, so the two pairs of years are not on an identical entity base, a distinction Entrackr’s reporting flags explicitly.

The FY25 jump in both revenue and loss traces to the same event: business promotion expenses rose from about ₹5 crore in FY24 to ₹103.6 crore in FY25, according to Inc42’s review of the group’s financial statements, a spike that lines up with the launch of CoinSwitch’s WazirX-linked user recovery programme. Employee benefit costs, by contrast, fell about 10% year-on-year in FY25 to ₹198.5 crore, showing a company still running lean on headcount even as it spent heavily to acquire and retain users. CoinSwitch’s own headcount has shrunk from roughly 519 employees in August 2023 to about 289 by August 2025, per public filings and employee-count trackers cited in press coverage of the company.

Where the money comes from

Nearly all of CoinSwitch’s revenue still comes from one product, in one country: retail crypto trading fees and spreads earned from Indian users. Lemonn, the stockbroking arm meant to diversify PeepalCo’s revenue base beyond crypto, launched only in April 2024, offered zero brokerage and no account-opening fees for its first months to build volume, and functions as an independent company with its own management rather than a folded-in feature of the CoinSwitch app, per Business Standard’s coverage of the launch. That means the diversification story is still mostly a plan rather than a reported revenue line; PeepalCo’s public financials to FY25 do not break out Lemonn’s contribution separately, and the ₹600 crore ($70 million, as reported by Cointelegraph, though the rupee figure of ₹600 crore comes from Medianama) WazirX user-recovery programme launched in January 2025 was itself partly a customer-acquisition exercise, paid out over two years through sign-up bonuses, revenue sharing and referral rewards aimed at pulling WazirX’s roughly four million affected users onto CoinSwitch. The surprise is less about geography or channel split, since CoinSwitch is essentially India-only and app-only, and more about how much of its recent “growth” spend was actually defensive: money spent to capture users displaced by a competitor’s failure, not to open a new market.

The risks

The first risk is regulatory, and it is not hypothetical: India’s 30% flat crypto tax with no loss offset and 1% TDS on transfers, in force since 2022, has already been shown to cut trading volumes by roughly four-fifths in a single year, and there is no indication as of September 2026 that the framework will be eased, so CoinSwitch’s core revenue driver remains capped by policy rather than by demand. The second is counterparty and security risk that sits outside CoinSwitch’s own systems: the 2024 WazirX hack showed that an Indian crypto app can take a large financial hit from a breach at a completely different exchange, through institutional balances and interlinked liquidity, and CoinSwitch’s FY25 accounts carried a contingent liability of about ₹98.8 crore tied to that episode, per Inc42’s reporting on the filings. The third is concentration risk in the business model itself: despite two years of talk about diversification into stocks, mutual funds, bonds and ETFs under the PeepalCo umbrella, the vast majority of disclosed revenue still comes from crypto trading fees and spreads tied to global bitcoin and token price cycles that CoinSwitch does not control, and Lemonn has not yet shown up as a material, separately disclosed revenue line.

The takeaway

CoinSwitch’s history is a reminder that a single line in a national budget can do more damage to a fast-growing consumer business than any competitor can. The 30% tax and 1% TDS rules of 2022 did not ban crypto trading in India; they simply changed the economics of trading frequently enough to make a fee-and-spread business model far less profitable overnight, and no amount of product polish could route around a rule written into the tax code. The lesson generalises past crypto: a business whose revenue depends on the frequency of a taxed or heavily regulated activity is exposed to policy risk in a way that a subscription or asset-based revenue model is not, and diversifying that exposure, as CoinSwitch is now trying to do through Lemonn, takes years to show up in the numbers, not quarters.

Frequently asked questions

Who founded CoinSwitch and when?

CoinSwitch was founded in 2017 by Ashish Singhal, Govind Soni and Vimal Sagar Tiwari, computer science engineers who built it initially as a tool to compare cryptocurrency prices across exchanges.

What is CoinSwitch’s current valuation?

CoinSwitch was valued at $1.9 billion in its October 2021 Series C round, led by Andreessen Horowitz and Coinbase Ventures, as reported by TechCrunch and Axios. It has not disclosed a new priced valuation since, so this figure is now more than four years old.

Is CoinSwitch profitable?

Its FY25 accounts (year ended March 2025) showed a net loss of ₹333.1 crore ($37.6 million), its widest yet, though the company has stated it was profitable at the group level in the quarter ended September 2025 (Q2 FY26), per Inc42’s reporting.

What happened to CoinSwitch after India’s 2022 crypto tax rules?

Revenue from operations fell from ₹248.6 crore in FY22 to ₹45.6 crore in FY23, a drop of about 81.7%, after the 30% capital gains tax and 1% TDS on crypto transfers took effect between April and July 2022, and the company laid off 44 employees in August 2023 citing role redundancy.

What is PeepalCo and how does it relate to CoinSwitch and Lemonn?

PeepalCo is the umbrella brand CoinSwitch’s founders unveiled in December 2023 to house multiple financial products; it operates the CoinSwitch crypto app and the Lemonn stockbroking app, launched in April 2024, as separately managed businesses under one parent.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• TechCrunch, October 2021 — “a16z, Coinbase crown India’s second crypto unicorn in $260M funding round for CoinSwitch Kuber”
• Axios, October 2021 — “Indian crypto exchange CoinSwitch Kuber valued at $1.9 billion”
• Entrackr, October 2021 — “CoinSwitch Kuber turns unicorn with $260 Mn round led by a16z and Coinbase”
• Republic World, October 2021 — “CoinSwitch Kuber becomes 2nd cryptocurrency ‘unicorn’ in India with $1.9 billion valuation”
• Forbes India, 2021 — “CoinSwitch Kuber, Vimal Sagar Tiwari, Ashish Singhal, Govind Soni: Making crypto as easy as Zomato”
• Inc42 — “CoinSwitch — Funding, Revenue & Investors” company financials and funding tracker
• CoinDesk, December 2022 — “Indian Crypto Traffic Took a Nosedive as Tax Regime Tightened”
• CoinDesk, August 2022 — “CoinSwitch CEO, in Wake of Searches by Indian Authorities, Says the Crypto Exchange Is ‘Fully Cooperating'”
• Business Standard, August 2023 — “Crypto unicorn CoinSwitch lays off 44 employees citing role redundancy”
• Entrackr, March 2024 — “CoinSwitch’s scale dwindles 82% in FY23; posts Rs 385 Cr loss”
• Inc42, December 2023 — “CoinSwitch Launches Umbrella Brand PeepalCo Amid Transition To Wealthtech”
• Business Standard, April 2024 — “Crypto exchange platform CoinSwitch’s parent launches app for stock broking”
• Entrackr (Fintrackr) — “CoinSwitch’s parent PeepalCo revenue declines to Rs 38 Cr in FY24, losses shrink 65%”
• Inc42, November 2025 — “CoinSwitch’s FY25 Loss More Than Doubles To $37.6 Mn”
• Cointelegraph — “CoinSwitch launches $70M recovery fund for WazirX hack victims”
• Medianama, January 2025 — “CoinSwitch Announces Rs 600 Crore Plan for Users Affected by WazirX Hack”
• Decrypt — “WazirX Moved $75M to Global Exchanges After Hack: CoinSwitch Co-Founder”; “CoinSwitch Gets Court Approval to Secure $5 Million Stuck on WazirX After Hack”
• The Week / PTI, September 2025 — “CoinSwitch Becomes India’s First Crypto Platform to Cross 2.5 Crore Users”
• Inc42 — “Why CoinSwitch Kuber Puts Compliance Before Growth, IPO Plans”
• CoinSwitch — “CoinSwitch Spot Trading Fees” published fee schedule

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