Tradehill Exchange Meaning History FAQs

Tradehill Exchange Meaning History FAQs

Tradehill Exchange: Meaning, History, FAQs

Amilcar has 10 years of FinTech, blockchain, and crypto startup experience and advises financial institutions, governments, regulators, and startups.

What Was TradeHill Exchange?

TradeHill Exchange, also called TradeHill, was a Bitcoin exchange launched in June 2011 by Jered Kenna, an early Bitcoin enthusiast. It was among the first Bitcoin and cryptocurrency exchanges. Unfortunately, the exchange was shuttered in August 2013.

Key Takeaways

  • TradeHill Exchange was an early player in the Bitcoin community, offering a place to exchange digital and fiat currencies.
  • TradeHill was founded in 2010 by Jered Kenna, one of the first young Bitcoin millionaires, and launched in 2011.
  • The exchange had problems with payments and regulation from the beginning, and it closed permanently in 2013.

History of TradeHill Exchange

When TradeHill launched in 2011, the exchange immediately began to encounter problems. However, the founder of TradeHill Exchange, Jered Kenna, claimed that the exchange had 20% of the market in Bitcoin trades at its height.

TradeHill in 2012

In February 2012, Kenna announced that TradeHill would close due to increased regulatory scrutiny. He also added that "Everyone at TradeHill has been working without pay for several months after our payment processor removed over $100,000 from our account without notice. We decided to cover this loss instead of passing it on to our customers and are taking legal action against the processor."

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Cryptocurrency was very young at this point. The only other notable exchange at the time was Mt. Gox, which was notoriously hacked in 2014 with millions in cryptocurrency stolen.

The processor in question was Dwolla, which in 2012 was a startup. In March, TradeHill filed a lawsuit in California claiming that Dwolla had illegally charged it with over $94,000 in "chargebacks." Trade Hill claimed these charges forced it to sell all its assets and go out of business. However, the charges were dismissed to allow for alternative dispute resolution as agreed upon in Dwolla’s terms of use.

TradeHill in 2013

Later in 2013, Trade Hill reopened after launching a new service called Prime. Prime was a business-to-business digital exchange intended to facilitate the exchange of digital currencies between businesses and large investors.

Unfortunately, the day TradeHill re-launched, the U.S. Financial Crimes Enforcement Network released its new regulation on virtual currencies, which confirmed that anyone selling units of a decentralized virtual currency to another person for real currency or its equivalent is categorized as a money transmitter.

This categorization requires a significant investment of time and money to implement reporting, recordkeeping, and monitoring procedures. At the time, TradeHill wasn’t prepared to take this step, which caused further issues.

Kenna was hacked in 2016 and had most of his cryptocurrency holdings stolen through a telephone exploit.

TradeHill Shut Down in August 2013

Kenna had previously taken the initiative to legitimize TradeHill through a partnership with the Internet Archive Federal Credit Union (IAFCU). The partnership was intended to bring Federal Deposit Insurance to Bitcoin.

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Kenna announced that he was temporarily suspending the TradeHill platform via his Reddit account, and he said TradeHill was canceling its partnership with IAFCU: "Internet Archive Federal Credit Union has experienced operational and regulatory issues and we are no longer able to continue our relationship at this time."

This second shutdown effectively shuttered the TradeHill project for good.

Why Did TradeHill Shutdown?

TradeHill essentially ran out of funding after dealing with lawsuits and regulatory issues.

What Is Cryptocurrency?

Cryptocurrency is digital money designed to be decentralized and secured by blockchain technology.

What Is a Cryptocurrency Exchange?

A cryptocurrency exchange is an entity where you can buy, sell, and trade cryptocurrency.

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