The owners of Vault of Satoshi have announced that they will be closing the notable Canada-based bitcoin exchange on 5th February due to the “insane” growth of a new business venture.
Though short on details in the official announcement, Vault of Satoshi co-founder Mike Curry told CoinDesk that the success of new venture TurboFlix has encouraged the exchange’s owners to switch focus. Launched six months ago, the service has gained popularity by allowing global Netflix users to bypass restrictions that limit their movie libraries.
Throughout the conversation, however, Curry stressed that the decision is a personal one for himself and his co-founder Ryan van Barneveld, and that it shouldn’t be perceived as a bearish sentiment toward the wider bitcoin market.
“If I wasn’t involved in [TurboFlix], I would still be running Vault of Satoshi because it’s very attractive. We set up the infrastructure for basically a financial services company. We’ve done everything the best way possible.”
The co-founder’s statements reflect the difficulty of running a financial services businesses; Curry cited the 9-to-5 nature of TurboFlix’s business model as a benefit. When faced with a choice between the businesses, the founders suggested that they felt that splitting time between the initiatives would have been a disservice to Vault of Satoshi customers.
“TurboFlix is doing everything we need it to do and it’s going well, and its not very needy,” he said.
Curry went on to explain that while Vault of Satoshi is not actively pursuing a buyer, it is open to conversations that could lead to a transfer of ownership. The news comes amid the ongoing issues at leading US dollar bitcoin exchange Bitstamp, which earlier today suspended operations.
Withdrawal process detailed
In a notice posted to both its homepage and on Reddit, Vault of Satoshi said that it will no longer process deposits but that access to funds and withdrawal requests will be available until 5th February.
Vault acknowledged the potential for customers to draw comparison between it and Bitstamp’s issues, stating:
“We expect there will be some speculation as to why the Vault is going to be sealed forever, and we’d like to reassure the community that it has absolutely nothing to do with insolvency, stolen funds or any other unfortunate scenario.”
The company explained that it wants to focus more directly on its content streaming service, due to its impressive growth. Though Curry did not provide user figures, Facebook data shows that TurboFlix has already amassed more fans in just six months, 18,000 compared to the 3,700 for the year-old Vault of Satoshi.
Curry affirmed both in the post and the interview that he is still passionate about bitcoin, and that TurboFlix uses the digital currency as a payment option. Further, he is still bullish on the long-term potential of the technology.
“We made a decision that we could wait for this to become a lot bigger. It’s just so much effort compared to something that takes little effort and is doing so well,” he said.
Sale still possible
Curry indicated that Vault of Satoshi has been in talks with unnamed exchanges about a potential acquisition, but that the company opted to close owing to the likelihood of a long sale process.
“We got a bit of interest from some other exchanges and that’s about it,” Curry explained. “It’s just quicker for us to just close the site rather than go into some six-month agreement. We just want to move on with our winning horse.”
Curry went on to speculate that Vault of Satoshi will likely receive purchase offers, and encouraged those who are interested to reach out to the exchange’s general mailbox.
“At this point, if we were to get an offer from a legitimate trustworthy partner, we would consider [selling] it. Everything is fine, the exchange is great,” he said.
The entrepreneur added that he suspects Vault of Satoshi could still grow to dominate Canada’s still-small bitcoin market under a different ownership. The exchange currently has five employees.
Vault of Satoshi’s impact
Vault of Satoshi was long one of the more popular bitcoin exchanges in Canada and one of the more well-known exchanges from the country internationally.
The company was well-connected in the bitcoin ecosystem, and at times ambitious with the products it offered the market. However, it did face issues in some jurisdictions, notably pulling out of the US market in March of last year.
Though also not available in the US due to the fact that a full movie library is made available to residents, Curry said that he expects the future for TurboFlix to be just as bright.
The service opened up a private beta this summer to 10,000 users, igniting online interest in Canada where Netflix’s full libraries are not available.
Curry decline to speculate on whether he thought TurboFlix was a better long-term business model, adding:
“I’m not too sure, it’s definitely fun.”
Stan Higgins contributed to this report.
Featured image via CoinDesk