CoinSpot majority shareholder Russell Wilson has earned a $500 million payday from the exchange’s $800 million revenue in 2021 and 2022, despite a growing crackdown by Australian banks.
Wilson earned the bumper payout from the revenue CoinSpot earned operating on the outskirts of Melbourne since 2013.
CoinSpot Shareholders Earn $590 Million Despite Scam
Wilson had to share a slice of the CoinSpot takings with minority holders.
Relatives Clinton and Cindy Wilson were paid a respectable $21 million for a collective 6% stake in the exchange. In addition, co-founder Brendan Halfpenny and Melbourne investor Claude Huber each earned $70 million through a 10% share.
Founded by Wilson in 2013, CoinSpot earned $171 million from transaction fees in 2022. Other revenue came from “crypto trade facilitation” and an institutional staking business line.
The exchange lost $37 million after UK hacker James Parker exploited a flaw in CoinSpot’s system that didn’t transfer sold coins from his wallet. Wilson allegedly traced Parker and his accomplices to Blackpool, negotiating their return of $13 million in exchange for avoiding criminal prosecution.
CoinSpot has since become one of the largest Australian exchanges, becoming the shirt sponsor of the Australian Football League team Western Bulldogs during the 2021 bull market. It has over 2.5 million customers and employs over 200 staff.
Australian Banks Reduce Runway for Crypto Firms
But CoinSpot may face tougher times ahead as Australian crypto exchanges face fraud-related restrictions from banks and payment providers.
Sydney-based payments platform Cuscal has reduced crypto exchanges’ access to its banking license. The firm, co-owned by Mastercard, Adelaide Bank, and Bendigo, previously allowed crypto firms access to the Reserve Bank of Australia’s real-time payment system.
Like incumbents Westpac and Commonwealth, Cuscal and others also limit how much fiat customers can move through exchanges. This is because they have no picture of the customer and thus need to monitor fraud at the network level.
CoinSpot rival Binance has faced challenges after Australian authorities launched a probe into the exchange’s derivatives business.
Read our review of Binance alternatives here.
The exchange, which processes the highest global transaction volume, was also forced to delist eight AUD trading pairs in May. It has also faced Australian banking exclusion in the name of fraud reduction.
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