2019-1-29 21:29 |
It’s dark days we are living in, and for some, they are worse than for others. Investors are cautious before investing their money in startups. Governments are clamping down on crypto startups. Traders are less active than they were a year ago.
Naturally, the crypto winter is taking down its victims one after the other. Today, one more exchange has thrown in the towel, and it may be the first of many.
Liqui, a Ukrainian crypto exchange, announced today that it’s no longer able to provide its services to its clients. The exchange, which has been the subject of controversy in the past, blamed the bear market and reduced liquidity.
According to the announcement which it posted on its website, its clients will have 30 days to withdraw their crypto tokens. Lack of liquidity was cited as the main reason the exchange was closing down.
Much to our regret, after this step Liqui is no longer able to provide liquidity for the Users left. We also do not see any economic point in providing you with our services. However, we do not want to return to where we were a month ago. Hence, we decided to close all accounts and stop providing our services. It broke our hearts to do that.
With many traders and investors deciding to hold back and observe what direction the market takes, exchanges are losing out on revenue. Many retail traders who came into the market at its height also lost a lot of money and exited the market altogether.
The ExodusThe bear market has instilled so much fear in investors that some have turned to investing in gold. This is according to Jan Van Eck, the CEO of Van Eck Associates, a New York-based investment management firm. Van Eck is best known in the crypto circles for its championing of a Bitcoin ETF which it recently pulled down. Van Eck says that the firm will refile the Bitcoin ETF soon.
He stated:
I do think that Bitcoin pulled a little bit of demand away from gold in 2017. Interestingly, we just polled 4,000 bitcoin investors and their number one investment for 2019 is actually gold. So, gold lost to bitcoin but now it’s going the other way.
Clearly, crypto exchanges are feeling the heat as investors diversify. Kraken, the largest Euro crypto exchange by volume laid off 57 workers last year, 10 percent of its workforce then. Huobi Global, the fifth-largest exchange globally by volume, also laid off an unconfirmed number of employees in December last year.
While the aforementioned exchanges are big enough to weather the winter, smaller exchanges such as Liqui are not as lucky. Some are barely making enough to remain afloat, while many more have had to lay off a majority of the workforce. With reduced liquidity on these small exchanges, traders are abandoning them for the bigger exchanges which are more liquid. This is further worsening an already bad situation for small exchanges.
According to coinmanrketcap.com, Liqui is the 188th largest exchange in the world. In the past 24 hours, it facilitated $18,000 worth of crypto trades.
Liqui is still hopeful that the market can become more conducive and that they could make a comeback.
We may be back soon. However, that depends on the market which has significantly changed since 2017. We do not know what else to say but say thank you for supporting the cryptocurrency community and your faith in us.
Image(s): Shutterstock.com
The post Another Crypto Exchange Shuts Down. Is This the Beginning of the End? appeared first on NullTX.
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