Unbanked Shuts Down, Blames U.S. Crypto Regulations: A Trend in the Making?
Facing stringent US regulations, crypto fintech firm Unbanked has decided to cease operations, despite significant recent deals, highlighting the increasingly challenging environment for crypto firms in the United States.
Crypto financial tech firm Unbanked, a provider of crypto custody and payment services, has opted to cease operations, blaming the stringent crypto regulatory climate in the U.S.
Co-founders Ian Kane and Daniel Gouldman stated in a May 26 blog post that launching in the U.S. initially seemed a wise long-term strategy, but that hasn't proven true after five years. They held that while offshore crypto companies thrived by evading strict regulation, Unbanked chose to collaborate with regulators, a move they now admit resulted in wasted time and considerable expenses.
The executives expressed frustration with U.S. regulators actively impeding crypto-supporting firms, even those aiming to abide by the rules.
Despite recent significant deals, including a partnership with Mastercard, Unbanked has decided to halt operations. The co-founders revealed that an anticipated $5 million funding influx hasn't materialized due to the adverse U.S. regulatory environment, restricting Unbanked's ability to raise capital and maintain a viable business.
Unbanked’s closure follows that of other crypto firms, including Bitcoin Lightning Network payments company BottlePay, and crypto exchange HotBit, who both urged customers to withdraw funds immediately. On May 12, fractional-ownership NFT platform Teressa also shut down due to its corporate structure and financial circumstances.