Netagio, the London-based Bitcoin exchange, shut down its trading platform on Monday after less than a year of operations. The company moves toward a wealth storage business, a striking reversal for a
Netagio, the London-based Bitcoin exchange, shut down its trading platform on Monday after less than a year of operations. The company moves toward a wealth storage business, a striking reversal for a firm that weeks earlier added credit and debit card payments to its platform.
The exchange launched in July 2014 as a three-asset trading venue where customers could swap Bitcoin, gold, and British pounds on a single interface. Netagio was the first British exchange to offer this combination. The company had shown its platform at CoinSummit 2014 in London during the summer before going live.
The setup attracted both retail traders and institutional investors. Netagio operated in 114 countries and used a "maker-taker model" to reward liquidity providers. Customers concerned about the speed and cost of moving money across borders could conduct all their trading on a single platform within the UK, avoiding the need for separate accounts at other firms. The platform allowed trading twenty-four hours a day.
Simon Hamblin, Netagio's CEO, described the appeal: "We have been encouraged by the early and increasing appetite from retail customers and institutional investors. From our conversations, they clearly want to take advantage of the opportunities available from being able to trade between the asset classes on a single continuous exchange, any time of day or night. Concerned about the speed, cost and security implications of sending their transactions abroad, customers clearly wanted a British-based banking relationship, which we can now offer."
In recent weeks, Netagio expanded further. The company added USD and EUR trading pairs and partnered with WalPay, an Isle of Man payment processor, to accept credit and debit cards for Bitcoin purchases. The expansion was meant to tap into the largest Bitcoin markets outside China. Hamblin told reporters: "Our customers will always be our number one priority. We recently expanded our order books to USD and EUR in response to customer feedback and now also offer a choice of payment methods, with our new credit & debit card payments in addition to the traditional banking payments. The US and Europe are the largest markets for Bitcoin trading, after China, and as such present a great opportunity for retail and institutional investors wishing to access these markets."
But the Bitcoin market has shifted. Trading volumes have stalled. Prices have fallen. Regulators have grown hostile to the sector. Financial institutions view Bitcoin as too risky to support. In Britain, where Netagio operates, Bitcoin adoption has remained minimal.
The company cited market conditions and regulatory uncertainty in its decision to close the exchange. Hamblin explained: "We are immensely proud of our efforts and achievements to date while facing the reality of a stagnating market place in Europe, in an environment of regulatory and political uncertainty facing Bitcoin businesses. As experienced Board representatives we recognise when industry winds blow in other directions and it is time to review and restructure."
Netagio will launch a wealth storage business in March 2015, offering secure vault storage for individuals and companies seeking to diversify their asset holdings. The company will maintain KYC compliance standards from its exchange operations. Trading in Bitcoin, pounds, dollars, and euros closes today. Customers have 30 days to withdraw their funds.
