Around 75 crypto-currency exchanges have shut down due to hacks, scams or just disappearing for unknown reasons thus far this year.
In line with Crypto Wisser Exchange Graveyard around 5 of such exchanges were labeled as scams, and 4 including Altsbit, and Nerae, were flagged as being hacked.
In total 31 were pack up voluntarily while 34 were labeled as ‘MIA’ for disappearing with no further explanation. Dutch exchange NLexch, and Chilean Chilebit were the sole two flagged as being pack up by their respective governments within this year.
There are some macro trends that help explain why numerous smaller exchanges are failing. The expansion of DeFi and therefore the rise of decentralized exchanges in 2020 has put the ultimate nail within the coffin for several smaller operations.
Regulatory pressure has also increased since the first days of the industry and lots of exchanges simply haven’t been ready to continue with the regulatory needs. Hacks and scams are also cited as growing issues for exchanges.
The recent two renowned exchanges to possess a cloud over their futures are BitMEX and KuCoin.
Following the filing of criminal charges against BitMEX executives last week for banking regulation violations, crypto-currency security firm Chainalysis has labeled the exchange as “high risk”.
The security firm issued the warning to a variety of its status clients including government agencies, banks as well as exchanges, informing them that any exchange with criminal charges brought against it should be considered high risk.
The Singapore-based KuCoin exchange suffered a $200 Mln hacks earlier in the month of September, but it’s scrambled to reassure users by issuing a variety of security updates delving into the incident to offer transparency. The foremost recent announcement was updated on 6th Oct. as the firm continues with audits into the various assets affected.
Crypto-currency exchanges aren’t the sole entities disappearing. However, consistent with the user-generated content site deadcoins.com there are almost 2,000 altcoins and tokens that not exist for now.