Just came across a latest news that "Zipmex" is another exchange which have filed for Bankruptcy , after Voyager and others.. What do you think is the real reason for so many exchanges going down.
1) Could the reason be that they have inflated their trading volume , which is now they cannot sustain the real volume at time of dip
2) They lack liquidity
3) Exchanges have invested their liquidity somewhere else which is becoming hard to recover
4) Does it has to do anything with the global inflation that we might see in coming future
5) Do you think its good for the market where cheap players would be shutting down and people can have more robust platforms in future where they would be ready in situations like this.
6) Most Importantly its the people's money, will traders be able to cope up or have faith in trading crypto in future if they lose money like this??
In summary, any company could go bankrupt, including exchanges, and the reasons are many but do not mean that others in the same line of business are not doing well. This is why traders and investors should be careful and do thorough research before trusting any company with their money.
The reason for the bankruptcy might be due to unplanned business, mismanagement, more liabilities than they can cope with, harsh business environment, lack of funds and loans, and many other reasons. Yet, I don't think this should discourage traders and investors that mean business as they can always go for the best alternatives.