Crypto.com and TenX customers from the UK and Europe can no longer use their crypto debit cards.
The sudden freeze comes as the company that powers them, Wirecard, filed for bankruptcy today over allegations that it lied to auditors over $2.1 billion in funds. Its auditor, Ernst & Young, failed to request records for three years, reports the Financial Times.
Wirecard is now saying that the fund may be “non-existent,” and that it misled investors about how it made a profit. The former CEO of Wirecard, Dr. Markus Braun, who turned himself in to German authorities earlier this week, is accused of market manipulation and false accounting.
Due to its bankruptcy, Crypto.com and TenX customers from the UK and Europe are not allowed to use their crypto debit cards.
“Our customers in both regions will not be able to top-up their cards or transact today,”
Crypto.com said in a statement.
“Our customers will no longer be able to use their cards or buy bitcoins using a credit/debit card through the app. This is likely to come into effect within the next 24 hours.”
said TenX in its statement.
However, customer funds are safe. British financial regulators ensure that the money is insured and kept in separate banks.
“You can continue to store, send and receive cryptocurrencies at any time without interruption. The security of your funds is our top priority.”
Crypto.com says that the team is working on “processing credits to crypto wallets that are equivalent to the existing fiat balance on the card.” Expected to get this done in the next two days.
Crypto.com is also trying to find a new provider for its crypto debit cards so it can continue to issue them in the UK and Europe.
Crypto.com also offers crypto debit cards in the US and in Singapore. Although its US cards are issued by Metropolitan Commercial Bank, its Singapore cards are issued by Wirecard’s Singapore subsidiary, Wirecard Singapore.
Singapore has not prevented Crypto.com from issuing cards, but its financial authorities have instructed Wirecard to deposit funds at local banks, Reuters reports.