A year after extending its services to Ghana and Nigeria, the Singapore-based cryptocurrency firm Pillow recently announced that it would stop operating. The firm, which provided services for bitcoin investing, spending, and saving, blamed its demise on the “current regulatory climate and its impact on associated financial infrastructure.”
Pillow informed its user base—reportedly over 75,000 people in 60 different countries—of this via in-app message and urged them to withdraw their money as soon as possible. The corporation has given consumers until July 31st, 2023, to withdraw their interests to speed up the process. The site plans to stop bank withdrawals on July 7 and cryptocurrency withdrawals on July 31; the app will be deleted from the Play Store at that time.
The objective of Pillow, to give people in underdeveloped economies a way to fight inflation, has come to an end, but the company’s founders, Arindam Roy, Rajath KM, and Kartik Mishra, have not made the announcement publicly. To support this objective, the business received about $21 million from 15 investors.
After the business posted job openings a few months ago, Pillow’s shutdown decision may come as a surprise to some. This, however, emphasizes the pressure faced by cryptocurrency firms as they attempt to navigate regulatory settings all around the world.
Foreign Startups Struggle in Nigeria
A year after expanding to Nigeria, Pillow announced that it would stop offering its services there. However, household finances in Nigeria are getting tighter, which has decreased their purchasing power and disposable income.
It is anticipated that Nigeria’s current financial crisis will last longer. The effects of cost pressures brought on by strained markets and broken supply networks are another major factor contributing to widening inflation. Many startups have had trouble staying in Nigeria. Two significant examples of how international firms have recently suffered in Nigeria are Games and SweepSouth.
Notably, Nigeria has experienced devaluations and currency changes. Factors that should promote widespread cryptocurrency adoption in the nation, However, the current economic scenario has worldwide repercussions. Pillow’s most recent announcement might just be pointing to the fickleness of cryptocurrency adoption in the global economy.
Still a Crypto Problem
The closure of Pillow in Nigeria is the most recent in a string of closures of cryptocurrency firms this year. African crypto businesses’ hazardous situation has come to light as a result of the closure of several continent-wide payment services using cryptocurrency.
Since Bitcoin first appeared 14 years ago with the promise of transforming money and payments, these promises have remained unfulfilled and appear to be fading away. When you consider the various laws in the US and various other countries, the scenario becomes more gloomy.
Layoffs are already occurring at Nigerian crypto companies as a result of the crypto winter, which was characterized by sharp declines in the price of bitcoin and Ethereum as well as the failure of firms like FTX, Celsius, and Voyager. Because $4 million of its operating cash was deposited with FTX, Lagos-based crypto exchange Nestcoin had to lay off employees. Quidax said its problems are unconnected to FTX’s collapse.
The African cryptocurrency sector has potential, but many firms are having trouble surviving, with Pillow being the most recent loss.
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