Bitcoin startup, Bonafide announced that it will end its operations and start liquidation.

An email has been sent to all the shareholders that stated that the startup has been approached by a “leading” bitcoin company though the name has not been mentioned, for a possible acquisition.

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Yet, the sale was declined as it was considered to be “only beneficial to team members” and not to the investors.

Bonafide was founded in the year of 2013 and offered as API which provided the reputation data to bitcoin firms offering exchange, wallet and other consumer services.

The Bonafide’s team had a long- term aim which is that the bitcoin industry will have so many transactions from different sources that an independent system will be required as a source for reputation scoring.

Co- founders, Karthik Balasubramanian and Brian Moyer stated in the email, their belief that the movement of investor interest away from consumer- facing applications for the technology was also a factor.

The email stated, “While investment and activity continues to occur it is focused on private and alternate chains rather than bitcoin or other public chains where Bonafide operates.”

In February 2015, Bonafide raised $850,000 in a funding round and announced that it will build a reputation system for bitcoin. At the time, Brian Moyer explained that 500 startup venture partner Sean Percival has realized potential for Bonafide to generate more credibility in bitcoin market.

He stated, “What we’ve found is that people need to identify with something, whether it’s a person or an entity in the bitcoin ecosystem. People need to be able to see what’s out there.”

Moyer and Balusubramanian believes that there was little probability that they would be able “to generate revenue, pivot their product or secure additional funding”.

According to Moyer, the constant decrease in consumer spending the digital currency were a prevailing factor in the shutdown of the startup. This is also the reason the founding team is not in a hurry to start another project.

He stated, “We don’t want to be consultants. We got a lot of traction, but it hasn’t grown. There’s just no movement in the bitcoin space. Because of our backgrounds, we could probably raise money doing something different, but they’re all long plays.”

Moyer further expressed that the founding team has been working with any salaries since far back as April, and that it has explored possibly pivoting to the bitcoin compliance sector as well,

“We’re still going to be watching [bitcoin] really close.”