Prixbit, a cryptocurrency exchange based in South Korea, has officially shut down. The closure was shared in a note published on its website.
The exchange assured users of a safe transition process for their funds, saying it would return deposits and holdings to customers who register for refunds.
As for specific reasons why the exchange is terminating its services, the note points to “negative internal and external influences.” However, a report from BusinessKorea pointed to more specific reasons.
“Prixbit, a cryptocurrency exchange which closed its operations as of Aug. 9, has failed to overcome its financial difficulties and suspended its cryptocurrency trading services,” according to the report. “Many investors criticized the shutdown of the exchange as they were worried about withdrawing their investments.”
Other significant factors may have been a larger issue with trading volumes in the country, where regulators are working to take a more direct approach to cryptocurrency exchanges.
“A low transaction volume is another reason Korean blockchain startups avoid listing on domestic exchanges,” per BusinessKorea. “Only five or six South Korean exchanges rank among the top 100 in the world in terms of transaction volume. It is not exaggeration to say that 97 percent of domestic exchanges are in danger of going bankrupt due to their low volume of transactions.”
On September 18, 2019, the Malta-based cryptocurrency exchange CGEX, which is operated by South Korea’s Coinone, will also shut down.
Another potential stressor affecting cryptocurrency businesses in South Korea is rampant cyber attacks targeted at them by North Korea.
Jimmy has been following the development of blockchain for several years, and he is optimistic about its potential to democratize the financial system.