Crypto winter hits Crypto.com’s Irish entity as revenues plunge 80%

An Irish subsidiary of Singapore-based crypto asset exchange Crypto.com reported a nearly 80 per cent drop in revenues for 2022 amid a collapse in trading volumes and asset prices following a number of industrywide scandals.

Foris Dax Global, which owns the Crypto.com business name and is registered at an office in Dundrum Business Park in Dublin 14, is one of the Hong Kong-founded Foris group’s main European entities after it established a base here in 2021.

Recently filed accounts for the Irish company show revenues plunged from more than €372.2 million in 2021 to €74.9 million in 2022, a decline of more than 79 per cent.

It said revenues from the fees it charges customers to exchange crypto assets on the Crypto.com platform slumped by 86 per cent to €25.1 million in the year.

The drop-off coincided with a sell-off in crypto assets that began in 2022 as confidence in the industry was shaken following the collapse of the Terra stablecoin and Sam Bankman-Fried’s FTX in May and November of that year.

As scandals rocked the industry, the volume of crypto assets traded plunged, ushering in a so-called crypto winter, with retail and institutional investors pulling back. The price of bitcoin, the world’s largest crypto asset, sank to its lowest level of the most recent cycle in December 2022 before picking up again in 2023.

Crypto.com’s Irish entity swung to a small €124,633 loss in 2022 compared with a €2.9 million profit in 2021, its first in operation.

In a report attached to the accounts, the directors said performance had been in line with market expectation and the company maintained a “healthy financial position”.

[ 13% of Irish adults own cryptocurrency or NFT assets, new survey finds ]

The directors also noted that Crypto.com was in the process of applying for authorisation from the Irish Central Bank as a virtual asset service provider (Vasp), bringing it under the regulator’s supervision for the purposes of compliance with anti-money laundering and terrorist financing rules.

Once granted, the Vasp licence allows companies to passport their services to other countries in the EU. The directors noted the application process was still “ongoing” at the end of 2022 but that it planned to apply for authorisation in “several EU countries”. In June 2023, Crypto.com received its Vasp licence from the Spanish central bank.

Founded in 2016 in Hong Kong, Crypto.com has made notable forays into sports branding in recent years, acquiring the naming rights to the Staples Centre, home to the Los Angeles Lakers National Basketball Association (NBA) team, in 2021 and renaming it the Crypto.com arena. It is also the jersey sponsor for the Philadelphia 76ers in the NBA and has partnered Paris St-Germain FC. and the Miami Grand Prix in Formula One.