Nigerian Web3 Startup Says Funds Are Stuck With FTX, Lays Off Employees

On November 14, Nestcoin, a Nigerian Web3 startup that received funding from Alameda Research in 2021, disclosed that “a significant proportion of stablecoin investment” was still held at FTX. The CEO of the startup claims that by firing some workers, the business can concentrate on creating a more decentralized crypto future.

Using FTX as Custodian of Nestcoin’s Stablecoins

On November 14, the Nigerian Web3 startup Nestcoin alerted its investors that monies intended for the company’s ongoing operations are still held by the defunct cryptocurrency exchange FTX. The Web3 startup claimed that after reassessing its commercial situation, it was decided to let go of some staff.

The CEO of the startup, Yele Bademosi, signed and distributed a statement claiming that Web3 was not exchanging cryptocurrency assets on the now-defunct crypto market. Instead, Nestcoin—which received funding from Alameda Research—used FTX primarily as a custodian of its fiat currency and stablecoins.

As a custodian, we kept a sizeable portion of the stablecoin investments we raised for our daily operating budget at the closely related exchange, FTX, according to Bademosi.

‘A Decentralized Crypto Future’

Bademosi insisted that the startup’s choice to fire its staff was appropriate because it enables Nestcoin “to focus on building a more decentralized crypto future where no one organization or person can amass enough power to influence a nascent industry that has the power to do good.”

The Nestcoin CEO claimed in a tweet after the news that his current goal is to assist departing employees in finding new employment.

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