Accel-backed crypto startup Pillow to shut down operations on July 31

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Accel-backed crypto investment startup Pillow informed its users that it will be shutting down operations from July 31. The startup cited regulatory uncertainties and a tough business environment behind this call. The move comes eight months after the startup raised $18 million in a Series A round.

In a note to its users seen by Moneycontrol, the startup said, "We regret to inform you that the Pillow team has made the decision to no longer provide our current services through the Pillow app due to regulatory uncertainty, and will be closing operations on July 31."

The startup said that the funds of users will stop earning interest immediately and their rewards section will no longer be accessible. The users will get a consolidated statement of all their transactions on the Pillow app on or before August 7, 2023.

Crypto withdrawals will be open till July 31 and bank withdrawals will be live till July 7.

Founded in 2021 by Arindam Roy, Rajath KM and Kartik Mishra, the startup has more than 75,000 users in over 60 countries. Using its app, users could invest and save in US dollar-backed stablecoins, as well as in Bitcoin, Ethereum and others.

In October 2022, Pillow raised $18 million in Series A funding co-led by Accel, Quona Capital, Jump Capital and existing investor Elevation Capital. In February 2022, it had received $3 million in a seed round led by Elevation Capital.

The development was first reported by The Morning Context in India.

An African news website prior to this had reported that Pillow is discontinuing its services in Nigeria and Ghana, a year after entering the market.

Pillow's move comes a few months after another Indian DeFi app Flint, backed by Sequoia Capita and Coinbase had decided to shut shop in January due to regulatory concerns.