Crypto Companies Start Toppling Like Dominoes

12 November 2022, 12:21 GMT+0000
Updated by Kyle Baird
12 November 2022, 12:21 GMT+0000
In Brief
  • Crypto firms have begun feeling the effect of FTX crash as several of them have revealed their exposure to the exchange.
  • Galois Capital reportedly has $40 million stuck on the exchange.
  • The community also fears that blockchain networks like Solana and Aptos might be affected by the crash.
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Several crypto companies and firms are beginning to feel the extent of the damage of the FTX collapse, as some of them have funds stuck in the exchange.

While some of the affected companies have started disclosing their exposure, the extent of the damage could be far bigger than imagined, considering the amount that went up in smoke over the past couple of days.

Crypto Companies Feel The Pinch

Venture capital firm Sequoia Capital has announced a loss of its $213.5 million investment in the exchange. In a letter sent to its partners, it stated that it was marking down its investment to zero.

Since the incident, at least one crypto lender BlockFi has paused withdrawal. While the firm did not disclose the extent of its exposure, its decision has birthed speculations that it might be insolvent.

Several celebrities like Tom Brady, Steph Curry, and Naomi Osaka would also be recording losses. All were appointed global ambassadors of the firm last year.

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Previously, crypto lending firms that paused withdrawals, like Celsius and Voyager, following the Terra LUNA crash filed for bankruptcy due to the extent of their exposure.

Start Atlas Reveals it Lost Half of its Cash

The studio behind the Solana-based gaming metaverse Star Atlas disclosed that it lost half of its cash runway to FTX collapse.

ATMTA CEO Michael Wagner stated that the game developer had a “material cash exposure” in FTX with its deposit. However, he stated that its balance sheet is still strong enough to see it through.

Wagner did not reveal how much was stuck in FTX.

Galois Capital Loses 50%

Another crypto firm with exposure to the bankrupt exchange was the crypto fund Galois Capital.

Reports revealed that Galois co-founder Kevin Zhou said the fund has around $40 million locked in FTX.

The fund also confirmed this on Twitter, adding that it “did not use any Bahamian method to move funds out.”

Ren Protocol Funding Hang

Ren Protocol also disclosed that it had received quarterly funding from Alameda for the past 12 months. But it also stated that it would continue operating and looking for ways to continue the plans for Ren 2.0.

Meanwhile, the full extent of the losses remains unknown. Blockchain projects like Solana, Aptos, and Sui all have direct connections to the failed exchange.

Disclaimer

BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.