German crypto bank Nuri asks 500,000 users to withdraw money before closure

by · October 18, 2022

German crypto bank Nuri has asked its 500,000 users to withdraw money from their accounts as the firm prepares to shut down and wind down operations, marking it as another victim of the 2022 bear market.

Nuri first reported liquidity problems in August, after announcing it had filed for insolvency amid the financial strains of Crypto Winter. It said at the time that business would continue as usual as it worked on a restructuring plan and secured an acquisition, but an acquisition has not materialized.

In a blog post on October 18, Nuri CEO Kristina Mayer noted that despite the company’s best efforts, it is unable to sustain operations going forward.

Unlike bankrupt crypto lender Celsius which locked down user withdrawals before everything went south, Nuri is encouraging users to withdraw all their assets before the December 18 deadline.

“Customers have access and will be able to withdraw all funds until the said date. All assets in your Nuri account are safe and unaffected by Nuri’s insolvency. Trading will be possible until 30/11/2022,” the post says.

Mayer explained that “this year the challenges have become insurmountable due to the tough economic and political environment of the past few months, which prevented us from raising new funds or finding a buyer,” adding:

“On top of that, the insolvency of one of our most important business partners significantly worsened the situation and put us over the edge. As a result, Nuri had to file for temporary insolvency in August this year.”

While Mayer did not specifically name its insolvent business partner, Celsius appears to be the prime candidate as it had partnered with Nuri to offer Bitcoin (BTC) interest-bearing accounts to its customers. These accounts were stopped when Celsius went bankrupt.

Mayer also noted that the company remains bullish on the potential of blockchain-based financial services.

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“We still believe in innovative financial technology and are convinced that blockchain, cryptocurrency and decentralized finance will offer opportunities that add real value to people’s lives. Nevertheless, financial innovation should be safe, understandable and easy to use for as many people as possible,” wrote Mayer.