Gatecoin, Hong Kong-based Bitcoin exchange announced on their official website that the exchange had shut down indefinitely after facing multiple financial complications. The exchange entered liquation after it failed to recover losses suffered back in 2016 due to a $2 million hack.

The development team behind the exchange explained to its customers that the suspension of the service transpired after the exchange struggled to stay relevant financially for months.

The exchange was also dealt with the disruption of bank accounts after the 2016 hack. The banking problems surfaced back in September 2017 when the exchange’s Hong Kong-based accounts were taken down, and they remained inactive till date.

The official statement released stated,

“We have suffered financial difficulty over a period time to an extent that we are no longer able to support our operation. The court on Wednesday granted a winding-up order against our company. A provisional liquidator has been appointed and we have to cease operation with immediate effect.”

Gatecoin was launched in 2013 and the exchange was dedicated completed on Bitcoin, Ethereum and Ethereum-based token markets. During the 2016 hack, the exchange reported that it had lost a total of 185,000 ETH and 250 BTC, worth a combined $2.14 million of investor funds as a result of cybercrime.

The exchange failed to recover the funds but the company refused to completely shut down after the incident. The exchange pointed the blame towards a registered French payment service provider for freezing its operations.

The exchange released the following statement,

“Following our issues with our banking partners in September last year, we started working with a payment service provider [PSP] which is a fully regulated payment institution by the French regulator. However, that PSP failed to process most of the transfers in a timely manner which in turn almost paralyzed our operation for many months and caused substantial loss on our side.”

The exchange eventually mitigated its losses but the recovery was little too late. The situation failed to take a better stance as the PSP retained a large number of Gatecoin’s funds.

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Biraajmaan Tamuly

Biraajmaan is an engineering graduate who is exploring the ever-changing crypto verse while traversing his passion for cryptocurrency news writing. He is a Chelsea fan and a part-time poet and does not hold any value in cryptocurrencies yet.

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