German Crypto Exchange Nuri insolvent! 500000 customers affected
8/10/2022, 05:50 AM
The Berlin-based crypto bank Nuri has filed for insolvency on Tuesday. This is due to the consequences of the coronavirus pandemic, the market upheaval after the Russian attack on Ukraine and the crash of the cryptocurrency market. The prices of Bitcoin and Co. have halved since the beginning of the year. Nuri's business operations are to be continued for the time being. At the same time, work will begin on developing a restructuring concept.
Nuri attributes the insolvency to the consequences of the coronavirus pandemic, the market upheaval after the Russian attack on Ukraine and the crash of the cryptocurrency market. The prices of Bitcoin and Co. have halved since the beginning of the year. Nuri's business operations are to be continued for the time being. At the same time, work will begin on developing a restructuring concept.
The fintech now has just under half a million customers, who trade cryptocurrencies via the app. However, the fact that Nuri is now insolvent is likely to come as no surprise to them. For months, the Berlin-based fintech has been in financial difficulties. In June, Nuri announced that it would be dismissing a quarter of its 200-strong workforce.
With Nuri, the first German fintech has collapsed in the wake of the crypto crash.
The main reason for this is the partnership with the US-based crypto lending platform Celsius Network, which also filed for insolvency in mid-July. Celsius loaned out cryptocurrencies, issued crypto-backed loans and launched crypto savings products.
Investors could store their cryptocurrencies with the risky crypto savings bank, in return they received an interest rate of up to 17 percent. Due to market turbulence, Celsius stopped transfers and withdrawals in June. Investors had no access to their crypto assets anymore.
This also affected Nuri customers. Those who invested in a special product of the neo-bank - the Bitcoin earnings account - indirectly placed their money with Celsius. Customers lent Bitcoins to Celsius via Nuri. They were promised an annual return of three percent on their Bitcoins. Even today, those affected are still waiting for their money.
Insiders from the financial world are observing the developments at the fintechs with concern. Due to the deteriorating market environment, it will become more difficult to attract venture capital for financing rounds.
Fintechs that have specialized exclusively in particularly volatile cryptocurrencies are particularly at risk, says an expert. Many private investors are withdrawing from the market, making it more difficult for crypto startups to do business.
It is still completely unclear what will happen to Nuri. First of all, the competent Berlin District Court has to accept the insolvency application.
Nuri attributes the insolvency to the consequences of the coronavirus pandemic, the market upheaval after the Russian attack on Ukraine and the crash of the cryptocurrency market. The prices of Bitcoin and Co. have halved since the beginning of the year. Nuri's business operations are to be continued for the time being. At the same time, work will begin on developing a restructuring concept.
The fintech now has just under half a million customers, who trade cryptocurrencies via the app. However, the fact that Nuri is now insolvent is likely to come as no surprise to them. For months, the Berlin-based fintech has been in financial difficulties. In June, Nuri announced that it would be dismissing a quarter of its 200-strong workforce.
With Nuri, the first German fintech has collapsed in the wake of the crypto crash.
The main reason for this is the partnership with the US-based crypto lending platform Celsius Network, which also filed for insolvency in mid-July. Celsius loaned out cryptocurrencies, issued crypto-backed loans and launched crypto savings products.
Investors could store their cryptocurrencies with the risky crypto savings bank, in return they received an interest rate of up to 17 percent. Due to market turbulence, Celsius stopped transfers and withdrawals in June. Investors had no access to their crypto assets anymore.
This also affected Nuri customers. Those who invested in a special product of the neo-bank - the Bitcoin earnings account - indirectly placed their money with Celsius. Customers lent Bitcoins to Celsius via Nuri. They were promised an annual return of three percent on their Bitcoins. Even today, those affected are still waiting for their money.
Insiders from the financial world are observing the developments at the fintechs with concern. Due to the deteriorating market environment, it will become more difficult to attract venture capital for financing rounds.
Fintechs that have specialized exclusively in particularly volatile cryptocurrencies are particularly at risk, says an expert. Many private investors are withdrawing from the market, making it more difficult for crypto startups to do business.
It is still completely unclear what will happen to Nuri. First of all, the competent Berlin District Court has to accept the insolvency application.