Acquisition of Circle Leads Poloniex Wallet Users to Yank Out Funds
- Poloniex has delisted many coins through the last few years of decreasing liquidity, leaving the platform with just 98 trading pairs.
- One of the most controversial coins to be delisted was DigiByte, which may have led to the gutting of the exchange.
Circle, Inc. recently made a game-changing decision for their customers, abandoning the US market entirely as they moved away from Poloniex. However, the decision has led many consumers to a drastic decrease in deposits for wallets on the Poloniex exchange. According to a recent article by Bitcoinist, the Bitcoin and Ethereum wallet users moved their coins to other markets instead, citing the decision to leave behind the US market as the main reason.
By the time Circle original acquired Poloniex, the supply of coins was already starting to dwindle. The exchange was dealing with technical and regulatory issues, and their traders were slowly decreasing. Tweets by CoinMetrics revealed that the supply that Poloniex held of BTC and ETH dropped dramatically during the Circle acquisition. As it stands, the exchange has not seen levels this low since 2016.
Poloniex’s supply of BTC and ETH plummeted after Circle’s acquisition, and are now at their lowest levels since early 2016.
— CoinMetrics.io (@coinmetrics) December 10, 2019
While the cryptocurrency market wasn’t regulated, Poloniex stood strong as one of the first exchanges to actually survive the years. However, the exchange also recorded many outages and disruptions in trading during that time, leaving it with a reputation for being unreliable. As recently as this year, Poloniex was forced to liquidate BTC collateral, leaving them with losses over the volatile CLAMS coin.
The socialized loss of about 1,800 BTC greatly angered traders, and the funds have still yet to be paid, which Bitcoinist suggests is one of the reasons that some traders have walked away from the exchange. While many analysts and experts would advise consumers not the store their funds on the exchange, the socialization of losses was definitely unexpected.
On 26th May 2019, poloniex took 16% from the btc holders/lenders because of the clam incident. Be very careful with @Poloniex , they do not honor their customers on the 1st hiccup they stole 1800btc from them
— Bourlas (@cbour) December 11, 2019
With the low liquidity, Poloniex also had to delist some of the coins that it previously had touted, which has mostly been unproblematic. However, when the exchange pulled DigiByte from their listing, the community became enraged, potentially becoming one of the reasons for the substantial outflow from Poloniex.
— crypto Bruno 🚀 (@cryptoexsahu) December 5, 2019
Considering the recent path that this platform has taken, Bitcoinist suggests that the focus of Poloniex is on the Tron ecosystem. As one of the larger carriers for the TRON-based Tether token (USDT), their listings have recently been opened up to other TRC-20 tokens. In fact, the TRX crypto asset is even an integral part of the earnings program for Poloniex, according to recent tweets from the latter.
New Ways to Earn 💰 Coming Soon!
Over the next few months we'll be introducing more ways for our hodlers to earn. We'll start with $TRX later this month and expand to other assets in the new year
— Poloniex Exchange (@Poloniex) December 10, 2019
Following this trend, the PoloniexDEX, which only recently launched, has already rebranded as the TRXMarket, now being used as a way for traders to access related coins and tokens.
Have you traded on @PoloniDEX yet? 😉
— Poloniex Exchange (@Poloniex) December 11, 2019
Presently, daily trading accounts for $44 million on the Poloniex exchange, though these numbers are relatively low for an international exchange. Even with the many delisted tokens, the exchange still has 98 trading pairs, giving them a little standing against the competition of the market.