Hong Kong-based Bitcoin exchange Gatecoin said it had shut down due to financial difficulties. The stock market was hacked by $ 2 million in 2016 and could not get the funds back. However, Gatecoin accuses a registered French payment service provider of paralyzing its operations. The payment company allegedly misled the exchange from an undisclosed amount in non-cleared bank transfers.
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Payment provider paralyzes Exchange operations
"We have suffered financial difficulties over an extended period of time in which we can no longer support our operation," complained Gatecoin in a statement released on its website announcing the closure on 14 March. The court on Wednesday "granted an order against our company, a provisional liquidator was appointed and we must close the company with immediate effect," he added.
Founded in 2013, Gatecoin focused exclusively on markets for Bitcoin, Ethereum and the Ethereum brand. In 2016, the stock market reported that it had lost 185,000 ETH funds and 250 BTC in investor money to hackers, totaling $ 2.14 million at that time. The funds were never reclaimed. But the hack was not the cause of Gatecoin, the store closed.
Instead, the stock exchange accuses an unnamed French payment service provider of consolidating its fate and declares:
After our problems with our banking partners last September, we started to work with a PSP, a fully regulated payment institution of the French regulator. However, this PSP was unable to complete most transfers on time, which in turn almost paralyzed our operation for many months and caused significant losses on our side.
Assets to be distributed to creditors
Gatecoin finally replaced the payment company in September and helped alleviate the losses, but it was too late at that point. The situation never really improved after that, mainly because the former PSP had withheld much of Gatecoin's funds.
"After months of trying to recover this money, we have taken legal action against this payment service provider. However, it has been suggested that it is unlikely that we will be able to fully recover the funds, "said Gatecoin.
The stock market has sought to reassure nervous investors by assuring "that we will support the liquidation process to accelerate the realization and redistribution of our assets to creditors."
Since the hack in 2016, Gatecoin has been disrupted with its bank accounts, which is too prevalent in the cryptocurrency industry. The banking problems of the stock exchange began in September 2017, when the accounts in Hong Kong were suddenly closed and are still inactive today.
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The article Bitcoin Exchange Gatecoin is first published in the Bitcoin News, citing financial difficulties.