Crypto

75 crypto exchanges have closed down so far in 2020

As least 75 crypto exchanges have closed down due hacks, exit scams or simply disappeared for unknown reasons so far this year. 

According to the Crypto Wisser Exchange Graveyard five of the exchanges, including Hotbit, FinexBox, and WCX, were labelled as scams, and four including Altsbit, and Nerae, were flagged as being hacked.

In total 31 were shut down voluntarily while 34 were labeled as ‘MIA’ for disappearing with no explanation. Dutch exchange NLexch, and Chilean Chilebit were the only two flagged as being shut down by their respective governments in 2020.

There are some macro trends which help explain why so many smaller exchanges are failing. The growth of DeFi and the rise of decentralized exchanges in 2020 has put the final nail in the coffin for many smaller operations.

Regulatory pressure has also increased since the early days of the industry and many exchanges simply haven’t been able to keep up with the requirements. Hacks and scams are also cited as growing issues for exchanges.

The latest two high profile exchanges to have a cloud over their futures are BitMEX and KuCoin.

Following the filing of criminal charges against BitMEX executives last week for banking regulation violations, crypto security firm Chainalysis has labelled the exchange as “high risk”.

The security company issued the warning to a number of its high profile clients including government agencies, banks and exchanges, informing them that any exchange with criminal charges brought against it should be considered high risk.

Some traders also seem wary of BitMEX’s future viability, with more than $500 million worth of BTC withdrawn from the exchange between September 30th and October 3rd according to Coin Metrics.

The Singapore based KuCoin exchange suffered a $200 million hack in late September, but it has scrambled to reassure users by issuing a number of security updates delving into the incident to provide transparency. The most recent announcement was updated on Oct. 6 as the company continues with audits into the various assets affected.

Crypto exchanges are not the only entities disappearing however. Acording to deadcoins.com there are also almost 2,000 altcoins and tokens that no longer exist.

This post first appeared here: https://cointelegraph.com/news/75-crypto-exchanges-have-closed-down-so-far-in-2020

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