Poloniex, one of the oldest crypto exchanges in the global market, has become a major digital asset trading platform once again after years of stagnation.
Until 2015, Poloniex was one of the largest crypto exchanges alongside Coinbase. It was the go-to exchange for traders investing in smaller trading pairs like tokens and alternative cryptocurrencies.
But, controversy around the legitimacy of the exchange and the operating team of Poloniex led the platform lose out in tight competition, falling behind Bittrex, Bitfinex, Binance, OKEx, Huobi, HitBTC, and many other major cryptocurrency exchanges.
In February, Circle, a cryptocurrency and blockchain company that raised hundreds of millions of dollars from large venture capital firms throughout the past few years, acquired Poloniex for over $400 million.
At the time, the acquisition of Poloniex was controversial, primarily due to the stagnation of the exchange and the emergence of new exchanges like Binance and Huobi that started to gain dominance over the market.
While the Circle team spoke highly of Poloniex and its core development team, the community was not convinced that the exchange should be valued at $400 million.
After a month and a half since the acquisition, in April, the Circle team stated that it made significant progress in rebuilding the exchange, especially the customer support side of the exchange. Prior to the acquisition, Poloniex had 159,000 pending customer complaints.
The build up of complaints about the platform and its operations largely affected the downtrend of the exchange. Subsequent to acquiring the platform, Circle immediately implemented a strong communication and technical support team. And it worked.
Within seven months, Circle turned around Poloniex and allowed it to climb back to its previous position. It recently surpassed Bittrex in volume, becoming a top 20 cryptocurrency exchange in the market.
“When the Poloniex-Circle integration began in late February, together we faced a backlog of 159,000 customer issues. Over the past 6 weeks, we have resolved 76,000 of those issues and added 6 new agents to our support team. We have tripled the number of engineers working on our wallet infrastructure and streamlined the process for notifying engineering when technical support is needed,” the Circle team said in April.
Based on the volume of Poloniex, it is quite evident that the exchange has shifted its focus from serving ERC20 tokens and less liquid assets to major cryptocurrencies like Ripple, Ethereum, Bitcoin, and Stellar.
In the upcoming months, as the market regains momentum and volume, Poloniex will have to compete against Binance, Huobi, OKEx, Upbit, Bithumb, Bitfinex and other leading exchanges that have loyal user bases and robust reputation.
Although the mid-term strategy the company will implement remains to be observed, the fact that large venture capital-backed companies have started to rebuild infrastructure in the cryptocurrency market, as seen in the Japanese market in recent months, is positive.
Featured image from Shutterstock.
Last modified: March 4, 2021 3:42 PM