06.10.202011:20 Forex Analysis & Reviews: 75 cryptocurrency exchanges have closed since January 2020

If we compare how many cryptocurrency closed this year and last year, it can be noted that there were 75 cryptocurrency exchanges that closed this year, which is 56% more than last year. Impressive, isn't it? It also compulsively pushes you to search for reasons, however, we have to think carefully like professionals. Recently, Cryptowiser, a service for analyzing trading platforms, named several main reasons that lead companies from the crypto industry to the inevitable end.

The first and, perhaps, the most important reason is the growing competition. Here, the most confident opponents of cryptocurrency exchanges are decentralized platforms and the entire sphere of DeFi. An additional source of stress is derivative platforms and services with actively circulating assets that have nothing to do with the cryptocurrency world, but are confidently gaining popularity.

The second reason for the active closing of global cryptocurrency exchanges is the tightening of regulatory rules in the industry. For example, in January of this year, the fifth directive of the European Union came into force, obliging crypto companies to verify clients in order to prevent the danger of money laundering and terrorist financing. Before this event, the Bitcoin Chopcoin gaming platform and the SimpleCoin mining pool announced that they would stop working, as they consider the new law a threat to the privacy of their users.

Cryptowisser further calls the reasons for closing exchanges reasons that are not as global as the previous ones, but together lead to a significant replenishment of the "graveyard of the crypto industry". Here, hacker attacks, leaving the market on their own, and receiving urgent recommendations from the authorities. Separately, it is worth noting hacks. It is known that last month, at least two cryptocurrency exchanges were subjected to such interference from outside. As a result of the incidents, KuCoin lost $ 280 million, and Eterbase lost $ 4 million.

However, the most mysterious reason for the termination of cryptocurrency exchanges Cryptowisser calls the mysterious disappearance of company management. It turns out that this also happens.