The Aphelion decentralised exchange (DEX), based on the NEO blockchain, has announced it is immediately halting trading activity on its mainnet and is urging users to cancel any open orders and return funds to their wallets.
Yes, Aphelion disables DEX for now as directed by counsel in response to EtherDelta ruling. Don’t believe the FUD though, project continues: https://t.co/vxy4jnMHiS …
— Aphelion (@Apheliontoken) November 22, 2018
Defiant that the company is only pausing and not closing down its operations, Aphelion’s CEO Ian Holtz explained that the regrettable action has been taken due to a “perfect storm of bad news” that included “new SEC rulings, disastrous market conditions, NEO tech challenges and diminishing cash flow.”
$20 of Revenues
Launched in a modest ICO at the end of last year that attracted less than $7 million in sales for its APH token, the exchange allowed users to set and accept trading terms themselves and compete in a truly decentralised manner.
However, with the overall market downturn, trading has been much lower than anticipated causing liquidity issues. After distributing a significant proportion of fees back to the community, Aphelion itself has only generated around $20 in fee revenues since opening its trading platform on October 10th.
In addition, the recent US Securities and Exchange Commission (SEC) ruling against another non-custodial exchange, Etherdelta, has led to expectations that the SEC will “…continue to target all crypto exchanges (decentralised or not).”
Aphelion hopes that, by taking proactive steps to disable trading activities, it can avoid any regulatory action and subsequently take time to “identify a path towards compliance.”
The exact direction of the path taken is currently under review but may include partnerships, obtaining a broker-dealer license, enabling full KYC-AML procedures or through co-operation with the new SEC FinHub initiative.