After four months of struggle, the time has come to say goodbye to another cryptocurrency exchange.
Crypto Is a Tough Business
That exchange is called Cryptopia, and it’s based on the island nation of New Zealand. The company suffered a security breach last January that saw millions in assorted crypto funds disappear virtually overnight. It was an ugly sight, and one that the exchange could never overcome.
Originally, the platform gave its customers a simple message, saying that it was undergoing “maintenance.” The notice on its website read:
Don’t panic! We are currently in maintenance. Thank you for your patience, and we apologize for the inconvenience.
The exchange remained down for several hours, and it wasn’t revealed until long after that the maintenance was a cover for the ongoing security audit that the company was undergoing. At press time, Cryptopia says that it has halted all trading and deposits and that it is currently “in liquidation.”
An official press release explains:
David Ruscoe and Russell Moore from Grant Thornton New Zealand were appointed liquidators yesterday of Cryptopia. Despite the efforts of management to reduce cost and return the business to profitability, it was decided the appointment of liquidators was in the best interest of customers, staff and other stakeholders. The liquidators are focused on securing the assets for the benefit of all stakeholders. While this process and investigations take place, trading on the exchange is suspended… The liquidators are also working with independent experts and the relevant authorities with regards to the company’s obligations.
Working in the crypto industry is a challenging and confusing business. Sometimes, things work out very well. Other times, not. As of late, it seems we’ve been witnessing several crypto exchanges close their doors due to outside market influence. One of the most recent exchanges to do so is Coinome, based in India.
The country has had a very rocky relationship with cryptocurrencies. Last year, the nation’s Reserve Bank made it clear that financial institutions could no longer do business with cryptocurrency exchanges or related companies. It has also implemented a limit on investor trades.
Following its decision to shut down, Coinome released a statement that read:
India is currently going through uncertainty on crypto guidelines and regulations. The government of India has not yet taken a decision on the regulatory framework for crypto exchanges or wallets. Further, the supreme court is yet to act upon the public interest litigation (PIL) on (the) regulation of crypto assets.
In addition, rumors are spreading that India is now considering a full-on ban of cryptocurrencies and digital tokens, though nothing solid has emerged from this yet.
Finishing Things Up
Cryptopia completed its press release by saying:
Given the complexities involved, we expect the investigation to take months rather than weeks.