On 2nd October 2019, the trading gateway CryptoBridge announced that they would officially terminate all their services and servers after 15th December 2019.
This news follows the introduction of the strict Know Your Customer (KYC) requirements that caught many of their users by surprise two months ago.
Founded in 2017, CryptoBridge, which ran on Bitshares blockchain and was named in 2019 as the third most active blockchain with regard to daily transactions. CryptoBridge was created to solve problems found in centralized trading platforms such as lack of transparency in the order books and trade activity, and devastating hacks.
The news comes barely one year after our exclusive interview with Head of Marketing Scott Wehman, who expressed a bright future and new development plans for the DEX.
Lack of Funds and Increased Regulations Contributed To the Decision to Shutdown
The trading gateway said that they put in a lot of effort and hard work to create a decentralized crypto trading gateway for connecting users and crypto assets, traders. Crypto Bridge stated that they did everything in their power to make this vision a reality, but several factors have forced them into this difficult position:
“We put a lot of hard work and did everything in our power to make the outcome different, but market conditions, increasing regulation, inability to fund further development and maintain operations forced us to make a difficult decision.”
CryptoBridge will close all deposits on 3rd December and all withdrawals by 25th December and urges all users to withdraw funds as soon as possible:
“All users have to withdraw their funds in the meantime. We highly recommend that you start the process as early as possible, as verification can take a few days.”
Shutdown Linked To Massive Backlash After CryptoBridge Enforced KYC on All Users
In an official announcement which has been now taken down, CryptoBridge introduced a mandatory Know Your Customer verification process. CryptoBridge stated their decision was partly influenced by the 5th EU anti-money Laundering directive (AMLD5). Sites that covered the story states:
“While we still strive to present new challenges for international financial regulation, we are facing the 5th EU Anti-Money Laundering Directive (AMLD5) and will adjust our gateway services to pave the way for CryptoBridge moving forward.”
The new directive forced all users to submit identifications before transacting on the platform so as to protect users and the DEX from being liable in the event of money laundering activities.
The move frustrated a lot of users who questioned the authenticity of the exchange after being forced to reveal their identities before being allowed to transact.
However, CryptoBridge has already deactivated all their social media channels and promises users the best customer care support will be available on their internal wallet support.
The exchange has also stated that they have paid out all existing non-mature BCO staking positions, and the contract has effectively been canceled as a result of the payout.