Bitfront has become the latest cryptocurrency exchange to cease operations following the crash of FTX, but possibly unrelated to this event.
The US-based cryptocurrency exchange backed by Line Corps, a social media firm hailing from Japan, has suspended all signups and credit card payments and has said that it will be wrapping up its operations within months.
Bitfront confirmed that the present market conditions have made it impossible for it to run the business as usual, so the company has chosen to bow out instead.
In a statement published on the company’s website, a spokesperson said: “Despite our efforts, we have regretfully determined that we need to shut down Bitfront in order to continue growing the Line blockchain ecosystem and Link token economy.”
However, Bitfront has denied that its own ceasing of operations had anything to do with rivals such as FTX and BlockFi folding.
Bitfront had already filed for bankruptcy earlier this month, with BlockFi announcing its own Chapter 11 proceedings on Monday.
Meanwhile, Bitfront is not accepting any new deposits and signups as of November 28 and will wind down withdrawals gradually by March 31, 2023, when consumers will no longer be able to access their accounts.
The crypto sector has been shocked by one of the most prominent companies collapsing unexpectedly, with FTX turning out to have used consumer funds to fund other ventures that were risky, and accumulating $8bn in liabilities.
This practice prompted Binance to opt out of purchasing FTX in a bid to save users and their funds, with Binance CEO Changpeng Zhao describing Sam Bankman-Fried, his FTX homologue, as a “psychopath”.
Bankman-Fried has since stepped down from the helm of FTX, but he and his company are now facing criminal investigations.