Blockchain.com started as the first Bitcoin blockchain explorer in 2011 and later expanded into wallet services, as well as hosting its own cryptocurrency exchange.
After years of growth, the company decided that 2022 would be the year it would expand into asset management services. Unfortunately, years of experience did not save the company from the bear market.
Operational for just under a year
Blockchain.com, which was worth around $14 billion when BCAM launched, created the asset management service in collaboration with Altis Partners.
The service was aimed at high net worth individuals and institutional investors and promoted the idea of investing in cryptocurrencies with less risk due to “algorithm-based risk-managed exposure,” a series of words that don’t mean much, considering all the facts. Transactions, cryptographic or not, are carried out using algorithms. Margin calls, for example, are technically based on an algorithm that reduces risk for the broker.
At the time, Charlie McGarraugh, Blockchain.com’s chief strategy officer, believed that the newly formed asset management arm was a great opportunity for investors around the world.
“Like everything in cryptography, you won’t know until you try it. But as with everything in crypto, we believe that we are growing towards the clear blue sky. It’s a great opportunity.”
Unfortunately, the timing was notoriously poor. After just under a year, 11 months to be precise, from the aforementioned exposure, BCAM applied to be removed from the UK company register. according to Bloomberg.
Crypto winter to blame
According to a BCAM spokesperson, the decision to close its doors came after nearly a year of adverse market conditions with little to no relief.
“Blockchain.com Asset Management launched in April 2022, shortly before rapidly deteriorating macroeconomic conditions. As the crypto winter nears the one year mark, we have made the business decision to pause operation of this institutional product.”
This makes Blockchain.com the latest victim of the crypto winter, although, like Silvergate’s decision to shut down earlier this week, it appears to be in an orderly fashion, with no need for bankruptcy proceedings as in the case of TerraformLabs, Voyager , FTX. and others.
Currently, there is no information available on how or when exactly the company will cease operations and how it will liquidate all active assets to return them to customers.
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