It is said that Swyftx and Superhero will end all communication.The $1 billion merger proposal between the Australian cryptocurrency exchange Swyftx and the investing platform Superhero has been abandoned.The increased restrictions over cryptocurrency businesses in Australia and the decline in interest in digital assets after the stunning collapse of FTX are a few of the primary causes.
Is This A Smart Move By Swyftx?
According to The Australian Financial Review, for an unknown fee, Swyftx will return Superhero to its founders, John Winters and Wayne Baskin, and a group of investors.The relationship has come to an end only a few weeks after the two parties maintained that a $1 billion merger deal was still on the table.Co-founder Winters praised all of the investors who were engaged, as well as his family and friends, for assisting him and Baskin in regaining control of their invention. The executive cited the declining demand for bitcoin goods and services as the main cause of the deal’s termination.
He continued: “Investor sentiment is going back to quality. This is partly due to the severe attitude that Australian watchdogs have taken on enterprises that deal in digital assets, as well as the fall of FTX. Our goal with our super product is to let customers access long-term conventional investments and provide them greater transparency and control over their superannuation.
According to further reports, Swyftx has substantial exposure to Binance. Recent speculations claim that the US DOJ may bring charges against the exchange for allegedly aiding in money laundering operations. This possibility may have led Superhero to withdraw from the contract.
The financial benefits of the merger, according to Swyftx CEO Alex Harper, have been completely erased by the regulatory environment in Australia’s recent months: “The policy environment has changed significantly since we announced the merger, and neither party has been able to realize the vision of the merger in any meaningful way. We presently face a situation where consumers may not see the advantages of the merger until at least 2024. Although the conclusion is unfortunate, we finally felt that it was in the best interests of Superhero, Swyftx, and their clients to make this choice.Swyftx will pay off its $55 million debt to the investment platform when the relationship comes to an end.
To prepare for a potential market collapse during the first half of 2023, the exchange let go of 90 of its staff (about 40% of its whole workforce) earlier this month.CEO Harper reaffirmed that his company has no direct connection to the insolvent FTX and expressed optimism that the adjustments would enable it to survive the present difficult circumstances.