Recently, the relentless conditions of the cryptocurrency market have begun to negatively affect companies. Recently, two cryptocurrency companies announced that they are going to downsize. Here are the details…
Star Atlas suffered a $15 million loss
Star Atlas, the famous Solana-based Gaming Web3 project, is grappling with the aftermath of the FTX crash and the wider repercussions in the cryptocurrency market. The company recently made an official statement addressing the challenges it has faced since 2021, including a substantial $15 million loss from its treasury due to the FTX debacle. Star Atlas, once known as one of the most promising projects of 2021, suffered a significant setback as its token value dropped nearly 99 percent from its all-time high of $0.268. The collapse of FTX and the subsequent turmoil in the Solana ecosystem had a profound effect on ATLAS, causing the token price to drop and the company financially strained.
https://twitter.com/staratlas/status/1683540297295495168
The CEO of ATMTA, the company behind Star Atlas, explained the current situation in a candid conversation with the Star Atlas community via Discord. The CEO explained that the collapse of FTX severely affected its operations and resulted in a dire financial situation. As a result, the core team was reduced from 235 members in late 2022 to just 45 as it stands today. The downsizing decision was taken as a precaution to deal with the financial challenge and restructure the company’s operations for sustainability. However, this decision is expected to create difficulties for the development and progress of the project in the near term.
Moreover, the fact that Star Atlas was faced with tax debts increased its financial difficulties. The unsuccessful efforts to raise capital and support from foreign investors further deepened the deadlock the project was in. Currently, the ATLAS token is trading at just $0.00146833, a significant drop compared to its heyday in 2021. Star Atlas DAO (POLIS), the project’s governance token, is also currently under pressure with a valuation of $0.098360.
Shrinking rumors about cryptocurrency exchange KuCoin
This came amid a wider crackdown on cryptocurrency exchanges by US regulators and officials from other countries. As we reported on Kriptokoin.com, allegations of downsizing on leading exchanges such as KuCoin and Binance contributed to the negative mood in the crypto market. Recently, KuCoin faced a lawsuit from US regulators, and news spread that the exchange will lay off 30 percent of its employees. However, KuCoin CEO Johnny Lyu denied these allegations. He stated that such drastic action would not be taken, even if some downsizing occurred in response to regulatory challenges.
1/ I'm aware of some rumors floating around about KuCoin. Let me clarify a few points and share a clear picture of how we're doing.
— Johnny_KuCoin (@lyu_johnny) July 25, 2023
Similarly, Binance faced rumors of laying off 1,000 of its employees. Thus, it added to the negative narrative surrounding the crypto market. While the situation in the cryptocurrency market remains volatile and uncertain, projects like Star Atlas are struggling to weather the storm. As regulatory pressures continue, industry players are navigating the complexity of the evolving crypto landscape while trying to restore confidence and stability in the market.
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