Bitwala, after having undergone a rebranding and reevaluation of its strategies after last year’s bankruptcy, is now making a surprise return to the cryptocurrency scene.
The Bitwala app is currently available in 29 countries in the European Economic Area (EEA), offering users access to Bitcoin and Ethereum—the industry’s two largest cryptocurrencies by market capitalization, which can be exchanged for the Euro and can also be sent using SEPA (Single Euro Payment Area) transfers.
However, notably absent from the list of supported countries is Germany, the company’s home country where it initially gained traction. While the app is accessible to more than 150,000 previous Nuri banking customers who still have the mobile app installed, as well as new customers, German users face a slightly longer waiting period due to specific procedures related to on- and off-ramp services.
A compliant solution tailored for Germany, according to Bitwala, is currently in the works and is anticipated to be available in the fourth quarter of this year.
“There are still some legal things because Bafin [German’s Federal Financial Supervisory Authority] has always had their special no recipe for success, but we expect to go live in Germany before the end of the year,” Bitwala CEO Dennis Daiber told Decrypt. “It took us a little longer than anticipated to get everything set up because as we are operating from Germany, there was a lot of a little bit of trickery here and there in the legal setup. So Europe is going live today and then Germany before the end of the year.”
Bitwala’s one unique feature is the use of self-custodial wallets, ensuring that users have full control over their digital assets, as opposed to relying on a crypto exchange.
Integration of the Lightning Network, the speedy payment and invoicing service running on top of the Bitcoin blockchain, is also on the agenda, as well as the launch of a crypto-backed Visa debit card, which will allow users to withdraw funds from ATMs or make purchases.
“Since the start of this year, our core team has eradicated all banking and lending code from the Nuri Mobile Apps,” said Daiber. “We have rebranded and are now offering Bitwala in the spirit of Berlin Room 77, the place where everything started for us: Freedom of Transaction.”
According to Daiber, the relaunched Bitwala app also continues the startup’s original technical approach: “no-hack, no-vulnerability self-custody.”
The reemergence of Bitwala marks a return to its roots. The company initially began operations with the same product range back in 2014. However, over the years, it diversified its offerings, leading to a name change to Nuri in 2021. Prior to that, Bitwala also partnered with German neobank Solaris to provide licensed bank accounts and debit cards. Yet, challenges soon emerged.
“The chain of events started that I had a very serious accident in 2017. I was therefore in rehabilitation for almost two years and was the only one working remotely,” Jan Goslicki, Bitwala’s CXO told Decrypt. “ At the end of 2018, my co-founder and CEO Jörg von Minckwitz left the company; very few startups survive such an exit. Effectively, that meant two out of three founders were gone.”
The global crypto market faced significant pressures last year due to various factors such as the war in Ukraine, economic headwinds, and rising interest rates. This, coupled with the collapse of the Terra crypto project and the bankruptcy of the U.S.-based crypto lending platform Celsius Network, shook investor confidence.
Nuri’s referral program involving Celsius further compounded its troubles, first leading to the company slashing its workforce by 20% and ultimately filing for bankruptcy in August last year. By October 2022, Nuri officially curtailed operations, citing “insuperable” challenges, which prevented the firm from raising new funds or finding an acquirer.
Still, as Daiber says, it had nothing to do with Bitwala’s core product.
“We had 200,000 KYC’ed customers and 50,000 monthly financially active users, decent revenue and great plans, just not enough money,” Daiber told Decrypt. “And that’s also why we chose to rejuvenate the project because we know people use it, we know people want it and we have the numbers to back that up.”
Bitwala’s relaunch was made possible with help from UK-based Claret Capital and several angel investors, as well as Striga Technology, an Estonia-based company building banking infrastructure for fintechs and digital assets services.
Additionally, over 150,000 devices still have the Bitwala app installed, with around 170 BTC and 2,300 ETH sitting in customers’ wallets after the Nuri insolvency.
“We know crypto winters are made for building and that’s what we’re doing,” added Daiber. “We have a small, extremely talented team of senior engineers that have built the product over the last years, and we are building for the crypto natives. I assume that if we can build a product that works for them, and it’s sufficiently secure for them then in the next bull run, we can take full advantage of that.”