Forex and Crypto News

Companies affected by the fall of the crypto market in 2018

10:16 07 January /2019

2018 was the year of a sharp fall in the cryptocurrency market. Bitcoin has lost more than 80% of its value. The fall of Bitcoin negatively affected other cryptocurrencies, traders, holders, miners, and companies. Some of the companies were forced to cut staff and budgets, and some became the bankrupts. Let's remember those who suffered the most.

Genesis mining

In August 2018, Genesis Mining began to close unprofitable mining contracts. Due to the decline in Bitcoin price that began in January, some cloud mining contracts began to bring less profit than their maintenance costs, so the company had to offer users to switch to five-year premium contracts without the possibility of premature termination - or cancel them.

Coinfloor

Coinfloor, the oldest Bitcoin exchange in the UK, was founded in 2013 and is targeted at institutional investors. It also suffered greatly from the consequences of a general fall in the cryptocurrency market last year.

As a result of the reduction of trading volumes, the company management was forced to restructure the company and seriously reduce staff. According to the CEO Obi Nwosu, the total volume of BTC trade at the site amounted to $1 billion over the past 12 months, but today, according to CoinMarketCap, the daily trading volume is slightly less than $500 thousand.

Giga watt

Giga Watt - one of the largest mining companies in the United States, formerly known as MegaBigPower, was founded in 2017 in Washington. In the summer of the last year, the company held an ICO and attracted more than $20 million. Investors of Giga Watt should receive either Giga Watt tokens, giving exclusive rights to free use of the company's facilities for 50 years, or mining equipment that should have been installed and run by the project team.

However, on November 20, 2018, the Giga Watt declared bankruptcy, submitting a relevant application to the Federal District Court for the Eastern District of Washington. At the same time, a company with assets of up to $50,000 owed creditors from $10 to $50 million.

Galaxy digital

The cryptocurrency trading bank founded by billionaire Mike Novogratz lost $136 million in the first 9 months of 2018, and in the third quarter, its realized and unrealized losses amounted to $41 million.

Novogratz had to make about $302 million to keep the bank afloat. In February, Galaxy Digital raised funds in the amount of $250 million to finance its operations and investments.

In November 2018, Galaxy Digital Bank announced strategic operational and organizational changes in its operations. The company decided to shift the focus from consultations to small ICO and blockchain projects to help large institutional clients. To do this, the bank will close the office in Vancouver and will be engaged in the expansion of the New York branch.

These are just some of the crypto companies affected by the fall of the market in 2018. In addition to them, the budget was seriously reduced and part of the employees had to be dismissed by the payment blockchain platform SpankChain, software developer ConsenSYS, the mining company Bitmain, and other companies playing a significant role for the cryptoindustry.

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