Local cryptocurrency platform put up for sale after failure to secure capital

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Under-pressure cryptocurrency trading platform BitPrime has been put up for sale, after failing to secure a capital injection, RNZ has been told.

The local company, which is one of the bigger players in the domestic market, was forced to suspend trading on its platform in May, after a “perfect storm” of a decline in trading, rising costs and a volatile crypto market created liquidity issues.

RNZ reported in June that the firm had secured bridging finance and resumed its over the counter service, while it negotiated with three unnamed parties about a potential recapitalisation plan.

At the time, BitPrime chief executive Ross Carter-Brown said its options ranged from a merger, an outright sale, or selling a majority stake in the business.

His preference was for an emergency injection of capital, so the company could resume normal trading and resurrect plans for a capital raise later this year.

However, it appears negotiations have fallen through.

RNZ has been told the company had been put for sale as a going concern.

BitPrime was yet to make a formal announcement but the company’s website was running a banner saying it was not taking new customers and that an update was pending.

It was unknown what a sale of the business would mean for its day-to-day operations or the company’s 30 staff, who were based in four countries.

The Christchurch-based firm was founded in 2017 and was controlled by Ross Carter-Brown and Monique Wright.

The business told a select committee hearing in February that its platform had 46,000 users and it generated domestic trading volumes in excess $100 million per year.

BitPrime estimated the domestic market had volumes between $300m and $400m annually, which implied it controlled between a quarter and a third of the domestic market.

Unlike some international exchanges, BitPrime did not hold any of its customers’ assets.

A smaller segment of the business operated an over-the-counter platform which was aimed at institutional and high-net worth investors.

These assets were held a by a third-party custodian.

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