Closed Down Bitcoin Exchanges
In any financial industry, whether it be banking, trading or whatever else, it is expected that some of the companies that are involved will become insolvent and shut down. It is the very simple nature of the financial world, where only the strongest survive and as an industry grows and matures, there will be a natural selection of those who were clever enough to prepare for the future and those that hadn't.
This article will highlight some of the bigger and smaller Bitcoin and Cryptocurrency exchange sites that has gone under since the beginning of Bitcoin trading in 2010. While we are sure that we have missed some obscure local site, the list will consist of sites that we know people who used and where they had somewhat of a reputation in the industry. Should you have any exchanges that you want added to the list, then you're more than welcome to contact us and we'll add the information so that other users can be aware.
It is important to note that while it is unfortunate that sites closes down and that some users may lose some money, it does help the longterm success of cryptocurrencies. For every exchange that has been forced to shut down due to lack of funds, due to hacks or even just due to bad management, we all learn and demand that the next place we trade cryptocurrencies will be better. This improves the industry as a whole and makes it a lot more difficult for companies who wants to take the easy road to money, or even scam, to get just a small marketshare.
So have a look at our list, read some of our articles regarding shut down Bitcoin exchanges, read about those that has been operating for years and then find a suitable place for you to trade. There are benefits to those that a major in size, as well as to those that are smaller and trying to gain marketshares. It all depends on your risk/reward situation, as you can gain higher rewards on smaller sites but have a bigger risk of losing your funds.
List of Exchanges That Went Belly Up
Below you'll find a list of Bitcoin and cryptocurrency exchange sites that has closed down over the years.
- Mt. Gox
- Bitcoin Market
- Bitcoin Brasil
- Crypto Rush
- Vault of Satoshi
While we won't go into detail with every single exchange that somehow collapsed, it is quite easy to give a general overview of what has happened generally in the industry. As it is a financial industry with a currency that has been booming in value, it tends to get the worst out in people who can become greedy or make stupid decisions to try and boost their profits short-term.
One of the most common reasons why an exchange has to close down is due to bad management. Bad management can be a ton of things, but most commonly it has been through decision making in how to run the exchange, either charging too high a fee, too low a fee or not offering the proper security for users, so they stop trading on their platform.
Another massive issue has been the hacking of platforms. Exchanges has not been doing a well enough job at securing their funds properly, which has led to massive amounts of Bitcoins and other cryptocurrencies being stolen from users. While this issue is less common than it was in the past, it is still a real threat and you should always take all the security measures you can, to protect your coins.
Finally the last “common” reason that exchanges bow under is due to theft from the owners. As the Bitcoin and cryptocurrencies has risen in value, it has made it harder for some companies and individuals to not simply cash out the balance and live off the money. This was more commonplace a few years back, where prosecution charges were not likely to be filed against you, but it still happens to this day, so make sure that the exchange you trade with is regulated by financial laws.