1-Month Left of Funding: Hack and Crypto Winter Deal NEM a Major Blow
The current bear market, or Crypto Winter as it is often referred to, has forced many solid projects to lay off employees and take a good hard look at their operational expenses and cash flow in order to make necessary changes to survive.
One particular cryptocurrency had an especially bad year, and due to the impact of an extremely high-profile exchange hack and the arduous bear market, the development team supporting the project is down to their final month of funding, and are throwing a Hail Mary in order to survive.
NEM Foundation: “One Month Left in Funding”
In a “message to the community” posted by the NEM Foundation on the project developer’s official forum, the team behind the NEM cryptocurrency revealed they were “facing challenging budget decisions.”
According to the post, the NEM Foundation team has been meeting a few times per week since December after the bear market reached new lows. The NEM Foundation devised a major restructuring of their C-level executive team, and required individual teams to begin reporting into the new executive structure with an added focus on “reporting metrics and delivering ROI.”
The NEM Foundation further explained that they were faced with the difficult reality of “having one month left in funding,” and would be forced to “put everything on hold,” and wouldn’t be able to “support” the team’s current “headcount,” suggesting that layoffs are looming.
Related Reading | Crypto Exchanges Begin to Shutdown: Bear Market in Full Force
The NEM Foundation has a plan, though. They are proposing a new budget based on a reduced burn rate. The team claims that it will allow them to “deliver ambitious results with responsible use of reserves.”
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“We are in a tough spot like many others in this space. It is our duty to act quickly to ensure the longevity of the NEM Foundation ecosystem and development,” the message revealed.
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Dear #NEM Community,
It’s been about one month since the new council started, and a lot has happened. We are committed to transparency, so we are pulling back the curtain with some good news, some difficult news, and some major #announcementshttps://t.co/OZo4fqkwLo pic.twitter.com/LmdkpzBGbu
— NEM (@NEMofficial) January 31, 2019
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The NEM Foundation remains steadfast in their belief that they “can solve this.”
NEM Begins 2018 in Top Ten Crypto, Falls From Grace After Hack
Like the NEM Foundation, many others have suffered during the bear market. Ethereum-focused blockchain startup incubator ConsenSys and even the billion-dollar Bitmain were forced to lay off staff as a result of revenue streams drying up.
However, NEM was hit especially hard during the 2018 bear market, and its extension into 2019 could deal a death blow to the project.
The fall from grace began after Japanese cryptocurrency exchange Coincheck was hacked, losing a record $530 million in NEM tokens. The theft is the largest the industry has ever experienced, and set off a chain reaction of regulatory changes following the country’s Financial Services Agency taking a closer look into exchanges in the region.
Related Reading | Japan’s FSA Raids Coincheck Offices Following $500 Million Hack
According to a historical snapshot from CoinMarketCap from mid-January of last year, NEM ranked #7 in the top 100 cryptocurrencies by market cap, with a price of $1.07. Another snapshot taken just one month later shows the cryptocurrency had fallen out of the top ten with a price of $0.39. However, it’s worth noting that most cryptocurrencies fell significantly that February.
Today, NEM has fallen 96% to $0.04 and is at risk of its development team running out of funding. While the percentage decline is typical of most cryptocurrencies, NEM was hit particularly hard due to the Coincheck hack that set the tone for the future of the cryptocurrency.
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