Although the recent crash in the crypto market is showing signs of recovery these days, the consequences of its damage continue to emerge. Blockchain services firm Eqonex is shutting down its Bitcoin exchange due to volatility and falling volume. The Nasdaq-listed company will now focus on its asset management and custody businesses.
A Bitcoin exchange is also pulling out of the field
Eqonex Ltd., a Nasdaq-listed financial services firm. (EQOS) will shut down the crypto exchange, according to an announcement on the company’s website on Monday. The stock market started in the not-too-distant past, in 2020. With the announcement made today, it will stop trading on August 22. However, customers will have until September 14 to withdraw their funds.
The main reason for the company to close the Bitcoin exchange is the financial situation. Therefore, this move aims to improve the financial situation of the company. It should be noted, meanwhile, that Eqonex will focus on the business line for which it received regulatory approval from the UK’s Financial Conduct Authority last year. Eqonex will focus on Digivault, its asset management and custody business, the first crypto custodian to receive this approval. Eqonex CEO Jonathan Farnell made the following statement on the subject:
We are focused on opportunities that will drive revenue growth and position us for long-term success. Closing the stock market will significantly simplify our work. It will also narrow our focus and free up resources. Moreover, it will allow us to operate as a more efficient organization capable of aggressively pursuing the market segments that offer the most potential.
The main reason for the closure is that it does not move the pointer in the financial situation.
CEO Jonathan Farnell also talks about the recent extreme market volatility and declining trading volumes. He notes that these have contributed to the headwinds felt by stock market operators. In this context, Farnell said:
We have a realistic view that our stock market will not move the needle for us financially in the medium to medium term. We see no value in continuing to bear the costs of operating an exchange during a period in which there may be a prolonged market downturn. We believe that proactively exiting the crowded stock market space is the right decision to deliver shareholder value.
Farnell has taken over the UK operations of crypto exchange Binance. Later, Eqonex appointed him as CEO in March. Meanwhile, in March, Binance-owned payments provider Bitfinity agreed to provide Eqonex with a $36 million loan that could be converted into equity.
Eqonex’s exchange is one of many crypto companies succumbing to market pressures this year. A $48 million loan from rival exchange Zipmex to Babel Finance went bankrupt. After that, the stock market had to stop filming. Moreover, Krypotkoin.comCrypto lenders Celsius Network and Voyager Digital have filed for bankruptcy.
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