Crypto startups have continued to feel the squeeze of the Bitcoin (BTC) downturn, even as 2019 has rounded the corner. Heavyweights Bitmain, Huobi, ShapeShift, Blockfolio, ConsenSys, and the NEM Foundation, most recently, have all fallen upon bad times.
The last mentioned industry upstart, the firm behind the XEM cryptocurrency, recently took to its company forum to debrief its community about its floundered state.
NEM Foundation In Death Throes
According to a post from NEM’s Secretariat Office, the Foundation, a “first-of-its-kind attempt at running a decentralized promotional organization,” was burning through nine million XEM ($390k) monthly. Although such a sum would have been fine in the bull market when the XEM’s collective valuation was running in the billions, the Bitcoin crash-induced bear market has led to a precarious, topsy-turvy financial situation for the group.
And with this in mind, the Foundation’s upper brass decided that it would be streamlining its team and operations. It was explained:
“We are proposing a budget with a burn rate reduced by about 60% from its previous level.”
The entity went on to dramatically reveal that it only had one month of funding left, subsequently explaining that it would be cutting its headcount, certain partnerships, and ambitious ventures, as it puts things “on hold.” In fact, NEM’s de-facto governing body wrote that the “NEM Foundation you knew before is gone.”
While all this sounds extremely is disconcerting (it is), the Foundation made it clear that it intends to see the NEM ecosystem succeed in the long run, and hopefully outperform by the time that Bitcoin and its altcoin brethren begin to rally again.
It was explained that NEM’s problems can still be solved, as the “technology is still among the best for developers looking to build applications,” and new projects, features, and platforms will help to bolster the crypto asset’s operations in the coming months. Moreover, the NEM Foundation divulged that it would be participating in more transparency and ROI reporting, while also ensuring that its teams are “aligned on goals.”
The future may not be looking too bright for XEM, but will NEM and its community pull through?
Bitcoin Isn’t Ready To Go Higher, Says Crypto Believer
This jaw-dropping imbroglio comes as Travis Kling, a former Wall Streeter turned founder of crypto fund Ikigai, claims that if Bitcoin is to see a resurgence, this array of shortcomings, including layoffs, exchange collapses, stringent regulation, and cries that “crypto is dead,” will be just the tip of the proverbial iceberg. Kling, a former portfolio manager at Steve Cohen’s Point72, recently took Twitter to claim that not enough horrors have befallen this industry to warrant a bull run.
Although such sentiment from a notable industry insider, and one with a presumably large vested interest, may seem harrowing, Kling said this with the thought process that a continued industry collapse would be the silver bullet to kill the raging, seemingly unrelenting Bitcoin bear.
Title Image Courtesy of Marco Verch Via Flickr