- Before July 19, the company recommended customers remove their cash.
- CoinPayments blamed it on new Anti-Money Laundering (AML) legislation.
Shortly after several firms went down, the crypto sector was hit with a lengthy bear market. As a result of the recent increase in market volatility, the crypto ecosystem is also under regulatory scrutiny. Market leaders are fleeing areas with more stringent regulations as a result.
Another Crypto Firm Shuts Door
CoinPayments, a worldwide crypto payment gateway, has also joined the exodus. Before July 19, the company recommended customers remove their cash before it shuts down operations in the United States through private emails. CoinPayments attempted to justify the abrupt shutdown by blaming it on new Anti-Money Laundering (AML) legislation in the United States and ongoing industry shifts.
A CoinPayments spokesperson stated:
“Unfortunately, due to recent AML regulations and changes, we are no longer able to provide services to the United States. The [U.S.-based accounts have] been flagged and will be closed on the date that is mentioned in the email that they have recently received”.
Exit scams occur when a company, whether old or new, steals money from investors by stating they have lost access to cash or assets due to hacking, seizure by the government, or other difficulties. Businesses claim they have no means of reimbursing the users in these situations and finally give up on the project.
The NFT industry’s definition of an exit scam is comparable to that of a rug pull because of their similarities. Rugpulls are more likely to occur when a cryptocurrency project has a detailed long-term strategy and promises its members substantial profits at launch.
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