Bear market blues
It’s not unusual for companies in the cryptocurrency and blockchain sector to be losing serious amount of money at the moment. The bear market has seen a bitcoin price retrace all the way from $20,000 USD down to $3000 USD, and is only now recovering after the longest downtrend in cryptocurrency history.
In terms of other blockchain companies, the Bithumb cryptocurrency exchange is certainly not the only one to have suffered loss and be hurting. With a 90% loss of online interest since december 2017, it’s a surprise that the majority of blockchain firms that rely on user engagement are still trading.
The 2017 bull market held riches for all companies in the industry – it was hard for them to go wrong. Bithumb itself posted a staggering net profit of $469 million USD in 2017.
Bithumb exchange cryptocurrency revenues grew in 2018
Despite the bear market’s negative effects on cryptocurrency companies, Bithumb increased its revenue 17.5% to $343 million USD – a massive achievement given the circumstances. Coupled with this however, the cryptocurrency exchange’s operating profit declined around 3.4% to $224 million USD from $232 million USD the year prior.
However the most troubling figure is that of non-operating expenses. In 2017 the exchange posted a non-operating figure of only $3.6 million USD, and in 2018 this figure rose almost 100x to $334 million USD.
Bithumb cryptocurrency exchanged hacked – further loss
The exchange has had a terrible time of late, but the outlook is still positive for the future. Bithumb has drastic plans to cut its staff almost in half – from 300 employees to only 150. This will surely result in huge savings for the company – but of course staff expenditure is likely a small portion of the hundreds of millions of dollars that the exchange operates within.
This move may in fact hurt the exchange more over time, if it can’t deliver the high standards of service and adaptability that are necessary for all companies within the cryptocurrency industry.
Bithumb could be helped by Cryptocurrency market reversal
However the two things Bithumb has going for it is its size – the sheer popularity of the exchange, coupled with the market turnaround – with bitcoin’s price over $5000 and with no signs of slowing down, interest may soon return to the markets, and with it – income for companies all over the world.
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