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Bundle Africa shutdown: Why the crypto company is closing shop

3 Mins read

Bundle Africa, a social payments app for cash and cryptocurrency, has announced that it is shutting down its operations.

In the announcement, Bundle Africa said business operations will shut down completely in September, 2023, ending its 3-year run. The company cited “Shareholders’ decision to restructure the business to focus on Cashlink.” as the reason for closing shop.

We will cease operations of exchange services as part of the Shareholders’ decision to restructure the business to focus on Cashlink. As Web3 and the blockchain community continue to grow, there is a need to focus on payment solutions that meet the ecosystem’s needs, which is the plan with Cashlink,” the company said in a statement.

Why did Bundle Africa shutdown?

Although, the company stated stakeholders’ decision as the reason for shutting down operations, a few other indices might have been in place to force the company’s shutdown.

  • Regulatory challenges: Bundle Africa faced a number of regulatory challenges on its business operations in Nigeria. For example, the company was not able to obtain a license to operate in Nigeria, which is the largest market in Africa, due to the ban placed on trading of crypto currency by the government in February, 2021. This ban happened at a time when Bundle Africa would have changed to top gear.
  • Competition: Although, there was no government restrictions on crypto exchange in Ghana, and Bundle Africa was able to operate better there, the company still faced stiff competition from other crypto exchange companies in the country. Companies like Yellow Card, Lino, Paxful, and Bitsika are some of the most popular crypto companies in Ghana, and they offer similar services to Bundle Africa.
  • Financial challenges: Bundle Africa launched in 2020, after raising $450,000 from Binance. It is unclear if the company was able to raise any other finds after that, and lack of adequate funding could have hampered the company’s operations, especially as it could not operate in its biggest market – Nigeria.
  • FTX collapse: Since the collapse of crypto exchange company, FTX, in 2022, a good number of crypto companies around the world have also come crumbling, because a lot of them hold their funds in FTX. While it is not clear if this is what played out with Bundle Africa, it is a possibility that Bundle Africa could have been pulled down in the cascade of crypto companies collapse going on since 2022.

What Bundle Africa users should do

According to the statement released by the company, immediately after the announcement was made, users will no longer be able to sign up on Bundle, deposit assets into their wallet, swap assets in their wallets (except for USDT), and withdraw with Cashlink. Bundle users are also expected to move all their funds to any exchange of their choice. The company added that the last day for users to convert to USDT is the 30th of August, 2023, and that withdrawal can be made up till the 10th of September, 2023.

While this is unprecedented, we’d like users to know funds are SAFE and can be withdrawn between now & September 10th. We will continue to provide our users and the community with unparalleled support during this time, even as the business transitions to Cashlink and other services,” Bundle Africa CEO, Emmanuel Babalola, wrote in a tweet.

About Bundle Africa

Bundle Africa was founded in 2020 by Yele Bademosi and Emmanuel Babalola. The company was based in Lagos, Nigeria, and had operations in Ghana.

Bundle Africa’s platform allowed users to send and receive cash, as well as buy and sell cryptocurrency. The company also offered a variety of other features, such as bill payments and peer-to-peer lending. Within its 3 years of operation, Bundle Africa amassed 50,000 monthly active users, 3 million transactions, and $50 million monthly volume.

Read also: Unraveling the Mysteries: Why Startups Fail and How to Avoid Common Pitfalls

The closure of Bundle Africa is a setback for the African fintech ecosystem. The company was one of the most promising fintech startups in Africa, and has now joined a list of other African crypto companies that have shut down in recent times.

Last year, Nestcoin had to lay off its staff after the controversial collapse of FTX – where it held investors’ funds. Fluidcoin also failed to raise funds to facilitate operations, and was later acquired by Bitfinex. Web3 and crypto company, Lazerpay, also had to shut down operations after it was unable to raise funds to continue operations.

The closure of Bundle Africa, however, is not the end of the story. The company will now focus on a product, Cashlink, which is a peer-to-peer (P2P) payment network with which the company plans to meet the payment needs of the growing Web3 and blockchain community.

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When I'm not reading about tech, I'm writing about it, or thinking about the next weird food combinations to try. I do all these with my headphones plugged in, and a sticky note on my computer with the words: "The galaxy needs saving, Star Lord."
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