Months after laying off 20 per cent of its staff, Melbourne start-up CoinJar is launching a US offensive as bitcoin prices continue to rebound.
Despite widespread layoffs and firms including FTX, Bittrex and Coinbase who are leaving or thinking about leaving the US, Mr Tan said his company’s expansion represents a continued belief in crypto’s future.
CoinJar late last year laid off 20 per cent of its global workforce – 10 staff – joining the likes of Banxa, Immutable and Swyftx in shedding headcount as deteriorating macroeconomic conditions and FTX’s collapse tore through the embattled sector.
Despite the prolonged period of pain, bitcoin is bouncing back and is now on course for its longest streak of monthly gains since 2021, climbing in value for the fourth month in a row. Its price is up 7 per cent in the last seven days.
CoinJar, which is based in Melbourne and was Australia’s first crypto exchange, is now hiring boots on the ground in the US ahead of a planned launch. Its investors include the Sydney-based venture capital group Blackbird Ventures, Digital Currency Group, Boost VC and early stage investor Bevan Clark.
“Where other exchanges see regulatory risk, we see opportunity,” Mr Tan told The Australian. “We’ve always understood that regulation has a key role to play in crypto’s future and we believe the American market will reward an exchange with our unparalleled compliance bona fides.
“While the past six months have undoubtedly been challenging, CoinJar continues to build and plan as we have through every market cycle over the last ten years.
“Our mission, through it all, remains the same as it was in 2013: to make crypto accessible and useful to everyone, every day.”
Bitcoin’s price is up 7 per cent in the last seven days.
The entrepreneur co-founded CoinJar with Ryan Zhou in 2013 and soon received funding from Blackbird Ventures, with the pair growing their company into one of Australia’s most trusted crypto brands, which its customers use to buy and sell cryptocurrencies including bitcoin. The start-up has since expanded to the UK and is also eyeing an EU launch.
The executive told The Australian CoinJar has this month begun its US recruitment process, which will begin first with the hiring of compliance specialists.
“Licensing is done at a state level in the US, so we will be gradually adding states until we can get close to full coverage of states,” he said.
“Both enthusiasts and the crypto curious are looking for trusted and easy-to-use methods of accessing cryptocurrency. The trade-off to offering that right now is being a centralised service and conforming to the local regulatory framework.
“While not every company is able or willing to satisfy this criteria, CoinJar believes we’re well suited to take on this challenge.”
Coinjar is celebrating its 10th anniversary, after what Mr Tan describes is a number of industry firsts including launching Australia’s first crypto-to-fiat debit card, CoinJar Card Mastercard; being the first Australian exchange to open UK operations and one of the first in the world to receive UK’s FCA registration; and the first crypto sponsor of a major Australian sporting team, the Melbourne Demons.
He said while it will be an uphill battle to go up against more recognisable names like Crypto.com in the US market, some of those brands have stopped being operational over the past year.
“We are not going in with the mindset that we will win every popularity contest,” he said. “To put things in perspective there are over 4000 banks in the USA, and a large number of those banks would be notable players when compared to an Australian scale.”
FTX chief executive Sam Bankman-Fried. Picture: AFP
While the turmoil and turbulence felt by the crypto markets has been painful, overall Mr Tan sees the turbulence as an inherent part of the sector.
Global leader FTX puts its Australian companies in voluntary administration in November following its US bankruptcy filing, with around 30,000 Australian customers owed either money or cryptocurrency.
Mr Tan said at the time that CoinJar had a small account balance with FTX but that it represented less than 1 per cent of its gross assets. He said that “crypto has suffered a reputational blow that will be difficult to overcome”.
The executive is now once again more positive about crypto’s prospects.
“I think many can acknowledge bad behaviour by industry participants without necessarily losing faith in the technology or industry,” Mr Tan said.
“We’ve seen interest in crypto markets ebb and flow in response to the prices, and this year is no different.
“Bitcoin and cryptocurrency is still a polarising subject a decade on. Over the years I have heard everyone from cab drivers to multiple prime ministers wrestle with the subject. Not all those takes I’ve heard have aged well … but that’s OK; cryptocurrency exists to ask hard questions of the status quo.”
