It probably comes as no surprise that Mintpal (after the atrocious V2 release) has shutdown.
It is somewhat more surprising that Moolah has also shut itsâ€™ doors. Moolah announced the move in a blog post.
Moolah chief ‘Alex Green‘ could only muster this: “While we have a solid consumer and merchant platform, our monthly costs to cover support, legal and operational expenses now greatly outweigh our incoming cashflow. In the space of a single month, we have rapidly burned through our reserves and are now in the position of having a negative balance sheet.”
Prior to this there was no advanced warning. Moolah now claims that they never bought Mintpal in the first place and were only ‘managing‘ the website. This contrasts sharply with the public statements made on July 28th that Moolah acquired Mintpal.
At that time, Mintpal was in deep trouble because of a ‘hack‘ which resulted in the loss of $2 million worth of funds. Coindesk described the takeover as a ‘mergerâ€™ and quoted Green as saying: “We believed that we were in the best position in terms of security, operational and performance expertise in order to take the exchange to the next level.”
Of course the ‘next level‘ ended up being a broken website which is now shuttered completely, along with customerâ€™s trapped funds.
Suspicions Have Swirled Since The Beginning
There have been tons of suspicions about Green and Moolah from the very beginning after their entry into the crypto arena.
A completely botched ‘takeover‘ of Mintpal raises the obvious question: what happened to all the cryptocurrency stored on their platform? According to statements, Mintpal had 70,000 accounts, many of which presumably had positive balances. People have been complaining for weeks about not being able to withdraw coins from Mintpal. Now there is a growing chorus of people who say they have lost coins on the ill-fated exchange. Suspicious people are doing their best to put the pieces together about the whole sordid affair.
This complete botch jobÂ is the OPPOSITE of what the altcoin industry needs at this juncture. It proves once again that trading altcoins is as dangerous as having unprotected sex! You never know what youâ€™re going to get if you participate.
Despite this whole ugly affair, it does make more established exchanges look better. Cryptsy, Bter.com, Bittrex, and others have managed to avoid true catastrophes like this. There were numerous warning flags surrounding Mintpal. To an outside observer, it seemed highly unlikely that Mintpal would have been able to win back trading volume after the Vericoin scandal.
As usual, this disaster makes the point which has been preached again and again: donâ€™t leave cryptocurrency on exchanges! If you do, make sure itâ€™s in small enough amounts that losing it will not wipe you out. Thefts can and do happen. Hacks of accounts also happen regularly. Safeguard your altcoins somewhere other than on an exchange.
There will be a lot more dirt coming out on this whole debacle, Iâ€™m sure. There are many red flags about Moolah, Mintpal, and Alex Green going back for more than half a year. The crows have come home to roost and the fallout is just beginning.
Thanks for stopping by and reading. What are your thoughts about Moolah and Mintpal shutting down?