Cryptocurrency
Crypto exchanges keep closing: what happens if a crypto exchange goes bust?
Published
2 weeks agoon
By
letizo News
A few days ago, Coinjournal presented a report on the number of exchanges that went bankrupt. As it turned out, from 2014 to 2022 at least 42 percent of the platforms stopped working completely and never came back. Over the past four years, the number of bankruptcies has increased significantly. In 2018, 23 exchanges went bankrupt. In 2019, that number increased by 252 percent. In 2020, another 17%. What should users do in this situation? Can you use a cryptocurrency exchange?
In 2021, the number of bankruptcies decreased slightly. But considering the situation now, when the market has been dominated by crypto winter for several months and the forecasts are disappointing, the number of bankrupt platforms will increase again. So before you transfer money, find out, is a crypto exchange legit?
What happens if a crypto exchange goes bankrupt: causes of exchange closures in recent years?
The closure and bankruptcy of cryptocurrency exchanges is caused by a complex of reasons. This leads to site closures; customers can’t withdraw funds, and administration stops communicating with them.
Scam
Exchanges are closed because they are scam projects. A scam is a financial scam aimed at bringing profit only to the organizers of the scheme. A scam is also a deliberate bankruptcy of the company, stopping any payments to the clients. Even though the network indicates a set of signs indicating that the project may be a scam, users still become their victims.
Fraudsters have come up with more and more sophisticated schemes to defraud users. Not infrequently, even experienced investors invest in such exchangers and then cannot return the funds because the sites stop operating. The administration disappears with the looted finances.
Pressure from the regulators
Another reason for the elimination of stock exchanges is the pressure from government regulators. They impose more and more stringent rules to control exchanges. The reason for such increased control is to minimize the risk of criminal use of cryptocurrencies and circumventing sanctions with them.
Recall that in January 2022 in the EU began to work. 5 Directive. It obliges all cryptocurrency companies to verify every client working with digital assets.
Not all exchanges can withstand the pressure and control of state supervisors and regulators.
Exchange hacks
Exchanges are also closing due to being attacked by cybercriminals. It is impossible to predict which exchange will be attacked. Hackers carefully look for vulnerabilities in exchanges’ security systems before hacking. Sometimes attacks result in a large percentage of customer funds being stolen. Exchanges are then unable to reimburse users and shut down.
Incorrect strategy of site development
Incorrect strategy means miscalculations of exchanges’ management, lack of experienced team of marketers, unable to increase the customer base. Because competition in the market is increasing, sites that could not offer exclusive tools for working with assets to customers become outsiders.
The number of transactions on them is reduced; capitalization is falling; customers are leaving for other platforms. Moreover, this can happen even to platforms operating for 5-10 years.
Results
If a crypto exchange goes bankrupt, you probably won’t see your money again. There are a lot of reasons exchanges are closed and stop functioning. Most likely, in 2022, the number of exchanges that will have to close will increase compared to 2021. The long recession in the market, scandals with projects such as Terra, accusations from regulators of illegal trading, hacker attacks, all this does not give cause for optimism.
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Cryptocurrency
The Balance: Bitcoin bearish trend hasn’t stopped Americans from investing more in cryptocurrencies
Published
2 hours agoon
August 8, 2022By
letizo News
Analytical resource The Balance posted a report stating that 39% of U.S. investors have become more invested in cryptocurrencies, despite the bitcoin bearish trend.
According to the report’s author, these Americans are looking for new investment avenues to preserve their savings amid economic uncertainty.
Meanwhile, 41% of survey participants said they invested more in stocks, and about a third of them invested more in exchange-traded funds and exchange-traded index funds amid market uncertainty. Thirty-four percent of investors reported no change in their investment habits.
Slightly more than a quarter of investors surveyed admitted to investing less in assets. Nearly 20% of those surveyed admitted to investing less in cryptocurrencies this year. The report’s author argues that investing in cryptocurrency in times of uncertainty is more popular among young people.
Nearly half of millennials and Generation Z investors (age 41 and younger) said they prefer cryptocurrency – as opposed to just under a third of Generation X investors and older. The online survey was conducted from June 30 to July 9, 2022, and surveyed 1,200 Americans over the age of 18 who at least partially manage their finances.
However, according to Bank Of America, the number of active cryptocurrency users is down more than 50 percent from its peak last November.
Cryptocurrency
Cumberland: institutional investors give bitcoin growth predictions as high as $32,000 as early as 2022
Published
2 hours agoon
August 8, 2022By
letizo News
US market maker Cumberland conducted a survey of institutional investors and found that most respondents were making bitcoin growth predictions as early as this year.
It is worth emphasizing that most of those surveyed are convinced that the crypto market will continue its decline in the near future. Analysts stress that the value of the main coin in the world of cryptocurrencies can fall to 16000 dollars. After that, Bitcoin should quickly recover the lost positions. At the end of the year, the value of BTC could reach $32,000. Cumberland experts point out that investors remain bullish.
“Even with the current bearish trend, these results are not surprising. After all, those surveyed are trading cryptocurrencies, which means they believe in bitcoin. If they didn’t have this attitude toward BTC, they would continue to trade forex,” Cumberland analysts said.
Respondents do not expect any success in the stock market, despite the significant correlation between the stock and markets in recent months. According to institutional investors, the crypto market, at least in the near term, will depend significantly on the U.S. Federal Reserve’s decisions on prime rates and “other Fed moves.”
Cumberland analysts have previously said that the recovery of the market will be determined by the rate at which assets move from insolvent to solvent companies.
Cryptocurrency
Is dogecoin a good investment? Elon Musk: Dogecoin is much faster than the Bitcoin network
Published
3 hours agoon
August 8, 2022By
letizo News
Is dogecoin a good investment? The CEO of Tesla again spoke out in support of Dogecoin. He stressed that the “meme cryptocurrency” network can process significantly more transactions than the Bitcoin network.
During a conversation with a podcast host, the head of Tesla and SpaceX said that the popularization of DOGE is paying off. The coin is increasingly being used as a full-fledged means of payment. As you know, coins can be used to buy goods and pay for various services of several large companies. The most important advantage is the high speed of transactions. Usually it takes no more than a minute to process a transaction online.
“To be honest, I mostly support DOGE because this cryptocurrency has memes, dogs, the developers have a sense of humor, they don’t take the project too seriously. And with all that being said, it’s strange that though DOGE was invented just as a joke, the actual throughput of the Dogecoin network is much higher than Bitcoin blockchain,” said Tesla’s CEO.
Ilon Musk also reminded that Dogecoin’s inflation model allows it to issue 5 billion coins annually, while Bitcoin’s number is limited to 21 million. And this makes DOGE much more suitable for use as a payment currency.
Recall that Tesla sold most of its bitcoin holdings amid falling cryptocurrency markets.
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