Germany-based crypto bank Nuri with half-a-million customers files for insolvency

  • Soon as Nuri announced its insolvency, its app faced heavy traffic with customers dealing with withdrawal issues.
  • Nuri assured that all customers’ funds are absolutely safe due to its partnership with Solarisbank AG.

The crypto market crash this year has seen some of the strongest players go out of business. On Tuesday, August 9, Germany-based crypto startup bank Nuri filed for insolvency citing major crypto sell-offs.

Nuri also noted the insolvency of Celsius and other crypto funds as the reason behind this move. German bank Nuri was serving more than 500,000 customers. It said that the recent move will “ensure the safest path forward for all its customers”. However, it also added that insolvency won’t affect its services, customer funds, investments, as well as the ability of the customers to withdraw funds from the platform.

Soon after Nurin declared its insolvency on Tuesday, heavy withdrawals ensued on the platform. The Nuri app started seeing heavy traffic and usage. However, the company clarified that user funds are absolutely safe. In a Twitter post, Nuri noted:

We are currently experiencing high traffic and usage, leading to slower performance in our mobile app. Our team is working hard to improve performance. Please note that funds are safe and you can try to use the app at a later point of time.

Nuri also pointed out the macro headwinds and the geopolitical tensions due to which there’s a meltdown in the public and private capital markets. Also, the implosion of the Terra ecosystem proved to be a watershed moment for the crypto industry.

Nuri’s partnership with Solarisbank AG

Nuri asked its customers to maintain patience as they faced difficulties during withdrawal on Tuesday. The good thing about Nuri is its partnership with Solarisbank AG. Thus, it doesn’t handle customers’ fiat and crypto funds by itself.

As per the information from Solaris Group, Nuri partnered with the bank and its crypto subsidiary Solaris Digital Assets. Thus, it outsourced banking and crypto custody licensing to Solarisbank AG.

By using Solarisbank’s crypto and banking infrastructure, Nuri was successfully able to scale its operations and services. Note that even if Nuri is currently undergoing the insolvency process and restructuring, Solarisbank AG is not facing any liquidity issues. Thus, in the official announcement, Nuri noted:

Let us reiterate the most important information for you: All funds in your Nuri accounts are safe due to our partnership with Solarisbank AG. The temporary insolvency proceedings do not affect your deposits, cryptocurrency funds and Nuri Pot investments which have been done with us.

Your Euro deposits in the Bank Account, Bitcoin and Ether deposits in Wallets & Vaults, and the Nuri Pot investments are not affected by this situation. You have guaranteed access and will be able to deposit and withdraw all funds freely at any time.

Formerly known as Bitwala, Berlin-based Nuri was founded in 2015. The company said that it will continue to work on its vision of building a better financial future.

Related: Germany’s $500-billion asset management giant seeks Bitcoin exposure to several funds

About Author

Bhushan is a FinTech enthusiast and holds a good flair for understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In his free time, he reads thriller fictions novels and sometimes explores his culinary skills.

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