Cryptocurrency mining platform Simplecoin has announced that it will be shutting down operations from January 1, 2020. It has asked users to withdraw cryptocurrency from their wallets on the platform by December 20, as afterward, the digital wallets and the mining service will be closed.
A basic version of the exchange will be available till December 31 for users who want to delete their personal information recorded at the time of becoming a member of Simplecoin. It will also be closed on January 1, 2020.
The Netherlands-based Simplecoin has blamed the European Union’s new Anti-Money Laundering Directive, which classifies exchanges like Simplecoin as “custodial wallet provider” for its decision to shut down. Under this category, Simplecoin was required to meet a large number of anti-money laundering (AML) and Know Your Customer (KYC) requirements. After looking for solutions, Simplecoin eventually concluded that there was no way around implementing the Directive.
Simplecoin decided to shut down operations as it felt that seeking the information required by the Directive, from their users, would compromise the very reason why the exchange was founded in the first place, protecting privacy and anonymity of transactions.
Regulators across the world have been forcing cryptocurrency exchanges to adopt stringent KYC and AML norms as criminals are using loopholes to transfer their ill-gotten wealth to tax havens abroad in the form of cryptocurrency. This puts regular cryptocurrency users at an inconvenience. These regulations have also harmed several cryptocurrencies like Monero and Zcash that are being delisted by crypto exchanges because they give greater anonymity to their users.
Though the platform is shutting down, it has held out hope that it may re-launch someday after incorporating new developments, with the words, “It is not over yet.”