After layoffs and losses in 2022, Coinhako on track to be profitable

Coinhako co-founder and CEO Yusho Liu / Photo credit: Coinhako

After hitting profitability in 2021, Singapore-based Coinhako felt the harsh winds of last year’s crypto winter. The company’s revenue plunged from US$36.3 million to US$10.8 million in 2022, according to its audited financial statements.

This downturn, coupled with economic and market challenges, also led the crypto exchange to lay off 20% of its total workforce in November 2022. The move is an about-face from Coinhako’s hiring efforts months earlier in July.

These results were in line with what the entire industry was facing at the time. But “as a matter of probability, the worst is over” for the company, Yusho Liu, CEO and co-founder at Coinhako, tells Tech in Asia.

In fact, the crypto exchange is now seeing a number of indicators of recovery and positive outlook in the crypto industry as a whole.

Liu expects to be operationally profitable in 2023. This is in contrast to its US$9.3 million in negative cash flow from operations in 2022.

Investors also continued supporting Coinhako even through the crypto winter. Liu said that since 2022, the company has raised a total of US$18 million to date from investors like SBI Group, Vina Capital, and Jump Capital. That amount is US$8 million more its previously reported fundraise in May 2022.

Plunging asset values

Coinhako had also gone from US$17.4 million in profit in 2021 to US$27.3 million in losses last year. However, US$24 million of the losses were attributed to an impairment loss of its digital assets.

Liu explained to Tech in Asia that a large number of Coinhako’s assets were held in tokens like Bitcoin and Ether, which had major declines in value last year. In particular, Bitcoin fell to about US$16,700 at the end of 2022 from around US$67,500 in the fourth quarter of 2021.

But 2023 seems to be a comeback year for Coinhako. So far, the company has logged a 912% increase in trading from its institutional and private clients this year compared to 2022, according to Liu.

These clients account for roughly 60% of trading volume on Coinhako for the year-to-date ending in September, he noted.

Total company traded volume, which comes from Coinhako’s institutional and retail trading segments, has been growing by 16% on a quarter-on-quarter basis as well, Liu said.

Data from Statista shows that globally, crypto trading has been recovering steadily as well, but it is still far from its 2021 peak.

The company is now looking to launch more products as it onboards more “sophisticated clientele.” These services will involve around allowing users to better manage their portfolio.