Times are getting tough for companies around the world as the global economy faces turbulence in the wake of the rapid spread of COVID-19. One of the first companies that pushed for Bitcoin adoption, particularly in the retail sector, announced that it will soon close down. Purse.io has said that it will be dissolving the company.
The company has operated as a Bitcoin payment processing firm for Amazon since 2014. Purse.io confirmed that it can sustain its business model any longer. The company became the first company to champion for consumer-based adoption of Bitcoin.
It gave Amazon shoppers a means to buy with BTC for a discount. In spite of being a ‘first mover’ in this industry, the company is calling it quits. The company’s operation model was simple, the platform enabled users to trade in their Amazon gift cards for bitcoins. That enabled it to successfully offer significant discounts to its customers.
We've made the very difficult decision to dissolve the company. We're grateful for the opportunity afforded by our supporters to build products and services for the cryptocurrency community.
— Purse (@PurseIO) April 16, 2020
Despite being in operation since 2014, it appears like profitability for Purse.io was dwindling. It is now shutting down in 2020 and it announced in a tweet that it would continue to operate until June 26. Only withdrawal services are available.
We will continue to offer support for ongoing orders and withdrawals until June 26, 2020, to ensure all transactions and accounts are settled.
— Purse (@PurseIO) April 16, 2020
The Challenges
The blockchain industry is highly challenging for firms and startups because profitability heavily relies on future expectations. Now, with the current coronavirus economic downturn, some crypto-related entities are worried about how it will affect their bottom lines.
It is not yet explained whether Purse.io closed down as a result of long-term issues or poor earnings in the last quarter. Crypto exchanges are at the most risk. Last August, an investigation discovered that 97% of crypto exchanges in South Korea were close to shutting down.
According to various commentators, exchange bankruptcies turned into the ‘failed ICOs of 2019.’ Some of them even scammed their users. With the current economic crisis worsening, more crypto-related firms might succumb as well. Their fate depends on how rapidly the global economy recovers and where crypto-related sentiments lands when all returns to normalcy.
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