In the latest crypto news, we are covering the rise of crypto exchanges lately – especially the largest ones out there on the market.
As first, we have the world’s largest crypto brokerage Coinbase which just got closer to finalizing a $500 million funding round at a valuation of $8 billion – as well as Binance which recently got more active in the investment sector, continuously funding blockchain startups.
However, the situation for smaller exchanges is not that good. While the major exchanges including Coinbase, Binance, and BitMEX are making leaps forward, smaller ones are in a bearish market, according to analysts.
A great example of this is Coinfloor, the exchange which slashed the number of its employees after seeing a decline in its revenues as a result of the drop in the daily trading volume of cryptocurrencies like Bitcoin as well as other altcoins. There are many similar cases to Coinfloor, which are mainly exchanges concerned by the low volume.
However, the UK CEO of Coinbase, Zeeshan Feroz, has been smart in dealing with challenges like these – even though his exchange is nowhere near the smaller ones out there. As he said in an interview:
“We have been working to introduce Faster Payments for as long as we’ve been operating in the UK. Customers not only benefit from increased speed, but reduced cost as well. By no longer having to convert funds from Pound Sterling to Euros and vice versa to add and remove funds, there will be no more exchange rates. This will make crypto easily accessible to most people in the UK.”
Still, we cannot dismiss the significance of Coinfloor’s cut of its employee count – mostly because of the strategic partners and investors that the UK-based exchange secured over the years.
Despite the involvement of high profile investors and venture capitalists, Coinfloor has not been able to face the stiff competition. As the CEO of the exchange Obi Nwosu said:
“Coinfloor is currently undergoing a business restructure to focus on our competitive advantages in the marketplace and to best serve our clients. As part of this restructure, we are making some staff changes and redundancies.”
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“By using Coinify, we are not running into the knife. It is still not clear to me how blockchain is any better than other database technologies. The transactions are so far more expensive and slower than a normal payment method. Decentralization brings only cumbersome improvements. None of the blockchains scale enough. But maybe I have not invested enough time and therefore understand too little how the blockchain ecosystem works.”Herren said that the decision comes after the prolonged bearish correction on the market where most of the crypto assets lost nearly a third of their value. Despite the fact that investors didn’t really get scared of the decline in prices, institutional adoption is still uncertain regarding making more profits. For example, back in 2018 in June, the Expedia hotel booking platform deleted Bitcoin out of their options and in the same year couple of months back, Reddit also stopped accepting cryptocurrency for its gold membership plans. Years back, Bitcoin became popular because of its attractiveness as a cheaper alternative for expensive payment processors. But as the technology got more popular, the network was unable to handle a higher number of transactions such as Visa or MasterCard and that’s why retailers didn’t choose crypto for making transactions. The Swiss retail giant brings bitcoin back into the retail game. However, traders who are into crypto or those who just hold on to it for better days can now use their coins to purchase something from the retail platform.
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