11-17-2022 icon

FTX insolvency freezes millions of dollars belonging to crypto firms

By Lucy Adegbe

The recent crash of the prominent digital currency trading platform FTX has continued to yield a cumulative and indirect impact on diverse areas of the digital currency space. Many crypto trading protocols have disclosed a substantial portion of their finance withheld on FTX.

From the 11th to the 14th of November, three digital firms published significant losses, with one of them cutting down on its workforce as a coping mechanism for the financial struggle.

Galois Capital published a tweet, on November 11th,  that it had huge sums of funds withheld on the bankrupt platform FTX. The Financial Times had reported, barely 24 hours later, that the protocol had about $50 million value of digital Galois property hung up on FTX.

On the other hand, the founder of the Hong Kong-located digital currency protocol Hbit Limited, New Huo Technology released a Tuesday information noting that it had failed to pull out its $18.1 million valued digital assets before FTX halted outgoing transactions. 

With $13.2 million of total estimated crypto asset loss belonging to Hbit’s customers, the protocol assured that it will figure out ways to get out the digital currencies soon. Hbit, however, acknowledged that withdrawals from FTX may not work as FTX has signed up for Chapter 11.

Nigerian Web3-based Nestcoin also notes its failure to take out its funds from FTX. Nestcoin’s Chair Yele Bademosi published a Monday tweet containing a letter he had sent to shareholders. 

According to the letter, the company plans to cut down on its workforce to manage functional costs.

CoinGeck analysis formerly noted that there would be an increase in crypto company layoffs in the later months.