German crypto-focused digital bank Nuri has filed for insolvency, citing macroeconomic headwinds and the crypto markets downturn. The firm, formerly known as Bitwala, filed for insolvency in a Berlin court on Tuesday, weeks after it said it would lay off 20 percent of its workforce in a drive to reach profitability. In a statement, it insists that the move “does not affect our services, funds or investments with Nuri” and that customers have “guaranteed access” to their funds, which can be withdrawn at any time.
“Due to the current challenging market developments and subsequent effects on financial markets on Nuri’s business development, we have filed for insolvency on Tuesday, August 9 2022,” said Nuri in a blog post.
Nuri operated under the name Bitwala until it rebranded in 2021. It was originally launched in 2015 and has established itself as among the better-known crypto services in the country. The German digital bank leans on Solarisbank for licencing and regulatory requirements, offering customers saving and crypto investment products. The company currently counts half a million customers and saw a quadrupling of revenue over the course of 2021.
Nuri has pinned its downfall on the crypto sell-offs and the collapse of cryptocurrency lender Celsius. Those factors, along with the coronavirus pandemic, economic and political uncertainties due to the Russian invasion of Ukraine, plus cooling of funding have all played a role, the company said.
“We proceeded with the filling in due time to stay ahead of a lasting strain on the liquidity of our business. 2022 has been a challenging year for the startup ecosystem globally, especially for fintechs,” the exchange said.
The company said the insolvency filings are “temporary” and it is currently looking for a “viable long-term restructuring concept in the company’s current situation.” Nuri is the latest cryptocurrency exchange to have been affected by the bear market. Recently, Singapore-based Zipmex, a Jump Crypto-backed exchange suspended withdrawals as it struggled with liquidity.