Crypto traders are reportedly down thousands of dollars following the collapse of another prominent Australian trading platform.
Liquidators have been called in to wind up another prominent Australian crypto trading platform, with furious customers reportedly down thousands of dollars after being unable to access their accounts.
Melbourne-based myCryptoWallet – which once boasted it had 20,000 customers – called in administrators on Friday to close the book on a troubled existence that featured tech setbacks and a period of inactivity following a dispute with major bank NAB.
ASIC documents show myCryptoWallet and its 28-year-old founder Jaryd Koenigsmann appointed Brisbane liquidators SV Partners to wind the company up on Friday, making it the second crypto company in two months to fail.
Another Melbourne company, Blockchain Global, collapsed in October owing investors a reported $21m.
The Australian reported on Tuesday that irate myCryptoWallet customers were unable to access their funds, with some taking to social media platforms claiming a $40,000 loss.
MyCryptoWallet was launched in late 2017 as a platform that let users buy, sell and trade assets such as bitcoin, ethereum and ripple.
It once said it had 20,000 customers, but a series of issues after its launch left users frustrated.
NAB froze the company’s accounts in early 2019 following a dispute, although myCrypto “made absolutely no attempt to give us any reason or justification for why they have closed our business bank account’’.
Withdrawals from myCryptoWallet were also suspended for a period after troubles at its tech partners. Many users reported being unable to access their funds or trade crypto as the market boomed to record highs.
Incidentally, the collapse of myCryptoWallet comes as bitcoin plunges from an all-time peak.
The world’s biggest cryptocurrency was worth $91,000 just a month ago but has since lost 30 per cent of its value amid fears over the emergence of the Omicron Covid-19 variant.
Bitcoin was trading at $69,000 on Tuesday morning.
A senate inquiry into the crypto sector in October recommended exchanges such as myCryptoWallet be regulated to provide assurance to investors.
The Reserve Bank of Australia also warned investors last month against piling into fad “meme coins”, saying there are “considerable risks” associated with cryptocurrencies.
Australian Securities and Investments Commission chairman Joe Longo said consumers were “on their own” because of limited regulatory protections.
The implications for consumers are potentially huge,” he said, the Sydney Morning Herald reported.
“It is almost an article of faith that no one should invest in something they don’t understand.
“Who among us can say they really understand crypto-assets and cryptocurrencies?” Mr Longo told the Financial Review’s super and wealth summit.
He said investors should view crypto with great caution, citing the maxim, “Don’t put all your eggs in one basket.”