Nigerian web3 startup, Nestcoin impacted by FTX collapse, reduces workforce
Nestcoin, a Lagos based startup that builds, operates and invests in web3 and crypto applications, has disclosed that it's downsizing its workforce to mitigate the effect of FTX's collapse on its operations. In a tweet shared by CEO, Yele Bademosi today, the startup disclosed that the
Nestcoin, a Lagos based startup that builds, operates and invests in web3 and crypto applications, has disclosed that it's downsizing its workforce to mitigate the effect of FTX's collapse on its operations.
In a tweet shared by CEO, Yele Bademosi today, the startup disclosed that the FTX collapse has impacted them negatively as their assets (cash and stablecoins) used for operational expenses were stored in the now-defunct crypto exchange.
"Unfortunately this means saying goodbye to some of our very talented Nesters (Nestcoin's employees' nickname)."
Clarifying that "We were not undertaking any trading activity, but simply custodied our assets in the FTX exchange".
An update shared with our investors earlier today on the FTX incident and its impact on @Nestcoin. pic.twitter.com/0Mjo4SYF7R
— YB (25,25) ⏳ (@YeleBademosi) November 14, 2022
Since Sam Bankman-Fried's FTX and other affiliates - Alameda Research and FTX Ventures crashed last week, the media has been awash with news that several companies' funds were stuck on the FTX crypto exchange.
Nestcoin joins a growing list of companies like Galois Capital, Genesis Trading, and Multicoin Capital that have had their funds trapped in the crypto exchange.
Nestcoin raised $6.45 million in February this year. According to Bademosi, the company used FTX to save a "significant proportion of the stablecoin investment" it raised from Alameda Research – one of the investors in the round with less than 1% equity in Nestcoin.
However, there seems to be hope on the horizon as Binance has announced today the start of a recovery fund to help crypto startups that are strong, but in a liquidity crisis.
