Valr, a cryptocurrency exchange, has announced that it has closed its crypto arbitrage service to new customers in order to meet the requirements of its banking partner. Valr is the latest South African crypto exchange platform to close its arbitrage business as a result of this announcement. Ovex was one of the first exchanges to declare its withdrawal from the market.
Requirements for Banking Partners Exchange are being pushed out of the arbitrage market.
According to a report, the South African cryptocurrency exchange Valr will exit the crypto arbitrage market on February 28 in order to meet the requirements of its banking partner. On January 31, the exchange also announced that it would no longer offer crypto arbitrage to new customers.
Valr is the latest South African cryptocurrency exchange to announce its intention to exit the crypto arbitrage market in 2022. Ovex was one of the first exchanges to announce its intention to exit the crypto arbitrage business, issuing a statement informing clients of the decommissioning on January 31.
While Ovex has not disclosed the reasons for its exit, Valr is quoted in a Moneyweb report as saying that partner requirements forced the exchange to make the decision. Valr, on the other hand, insists that its exit from the arbitrage market will have no impact on other services. According to the company, the decision to discontinue our arbitrage service was made to meet the requirements of some of our banking partners. Other Valr services are unaffected, and your funds are safe. You will continue to have access to Africa’s largest crypto asset marketplace, Valr, where you can buy, sell, and store over 60 cryptos.
Banks are hostile to cryptocurrency arbitrage traders.
This message was echoed by the exchange’s COO, Gianluca Sacco, who stated that Valr will now concentrate on its core business.
Meanwhile, Asif Aziz, the chief technology officer of Libex, another crypto exchange that claims to have been pressured to discontinue its arbitrage service, believes that banks’ hostility toward crypto arbitrage may be one of the reasons exchanges are abandoning the business.
“Banks have reportedly been hostile to crypto arbitrage for some time, evidently seeing customers purchase large amounts of forex for export without much regard for the return flow as these crypto trades were closed out and profits recycled back to SA,” Aziz is quoted as saying.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.