Recently launched cryptocurrency service platform, Cobinhood, has announced that it has suffered a termination of services from its banking partners. In order to continue operating, the exchange announced on its homepage that it will replace USD trading pairs with USDT pairs during the coming week.
Also Read: Vouching Bitfinex and Tether’s Bank Accounts Hold Nearly $3 Billion USD
Cobinhood to Adopt Tether in Response to Banking Woes
Taiwanese-based cryptocurrency service platform, Cobinhood, recently announced that its banking partners had suspended their services to the company.
The exchange claims that it “had confirmed cooperation with banks in several areas and successfully operated for a while; however, the banks had internal debates about cryptocurrencies, which they consider might create unclear effects with traditional banking operations. Despite our efforts to keep the dialogue open with our partner banks, they decided to cease the service for Cobinhood, unfortunately.”
In order to continue its operations, the company has announced that it “will start replacing USD trading pairs with USDT” and introduce “crypto-to-crypto trading.” Cobinhood states that it will “keep approaching different cooperation opportunities with various financial institutions” in the meantime, adding that the company “welcome[s] discussions with banks to open up better willingness to embrace the future crypto-economy.” The company also expressed its intention to “support multiple fiat [currencies] as soon as possible.”
Cobinood to “Buy Back” Customers’ USD
The company states that in order to “protect users’ right[s],” it will “buy back all the U.S. dollars in the exchange.” In order to do such, Cobinhood stated that it will first “manually cancel all the USD buying orders,” before opening “an amount of ETH/USD orders, the rate [of which] will be 10% lower than the price shown on Coinmarketcap” – indicating that company seeks to use ETH to buy back users’ fiat balances.
Cobinhood states that its USDT pairings are scheduled to launch on the 17th of February, and any customers that choose to retain their USD holdings after the introduction of Tether will have their fiat balances automatically converted into USDT starting from February 23rd.
Announcement Removed From Homepage
Since publishing the announcement just a couple of days ago, documentation explaining Cobinhood’s banking turmoil appears to have been removed from the company’s homepage – likely making it difficult for prospective customers to ascertain the quality of the company’s banking relationships.
What is your reaction to Cobinhood’s plan to continue its operations despite losing banking services? Share your thoughts in the comments section below!
Images courtesy of Shutterstock, Cobinhood
Need to calculate your bitcoin holdings? Check our tools section.