The collapse of the FTX exchange has created an uncomfortable situation for many cryptocurrencies. While some like BlockFi and Genesis could disappear, others should be able to weather the crisis. This is because they have less exposure to FTX. But radical measures must be taken for them, such as budget restructuring or workforce cuts. The Nigerian company Nestcoin fits into this logic. It is one of the few African players in the Web3 value chain.
A significant portion of Nestcoin funds have been held at FTX
On Nov. 14, Nigerian firm Nestcoin announced to its investors that a significant portion of its stablecoin investments had been locked up on cryptocurrency exchange FTX. This is mainly the working capital of the company, which is based in Lagos. A situation that puts finances in a delicate position and pushes those responsible to take drastic measures. In this sense, the company has announced that it will reduce the number of its employees.
“Laying some employees will allow the company to focus on building a more decentralized crypto future. A future where no single organization or person can have enough power to influence a fledgling industry, which has the power to do good.”. This is what it has declared CEO Yele Bademosi in a statement.
Furthermore, the company has ensured that it does not trade crypto assets on the now bankrupt exchange. “We used the closely associated exchange, FTP extensionas a custodian to hold a significant portion of the stablecoin investments we have raised for our daily operating budget”Bademosi explained.
Importantly, Nestcoin is the beneficiary of an investment from Alameda Research.
The CEO also said he was committed to helping workers who will be leaving “find work elsewhere”.
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Far from dampening my enthusiasm, a failed investment in a cryptocurrency in 2017 only increased my enthusiasm. I therefore decided to study and understand the blockchain and its multiple uses and to convey information related to this ecosystem with my pen.