Decentralized finance protocol token SafeMoon (SFM) has fallen 31% in five hours after the company filed for bankruptcy.
Safemoon officially filed for Chapter 7 bankruptcy, also known as โliquidation bankruptcy,โ in a December 14 filing. presentation before the United States Bankruptcy Court in the District of Utah. The voluntary petition was filed by attorney Mark Rose, and Chief Judge Joel T. Marker was assigned to the case.
A screenshot of a letter to employees purportedly written by the company's chief restructuring officer appeared on Reddit, explaining that its bankruptcy was the reason it could no longer pay employees' salaries prior to the filing.
โYou will have to file a claim in bankruptcy court for your unpaid wages,โ the document said.
The latest coup comes just a month after the United States The securities regulator accused SafeMoon, its founder Kyle Nagy, CEO John Karony and CTO Thomas Smith in November for violating securities laws in what the regulator described as โa massive fraudulent scheme.โ
The cryptocurrency fell from $0.000065 on December 14 at 8:24 pm UTC to $0.000045 over a five-hour period following the news. according to CoinGecko. However, it recovered to $0.000061 in a quick span of 10 minutes.
SMF fell 31% immediately after filing for bankruptcy before recovering slightly. SFM is currently changing hands for $0.00005729. The token is down 98.2% from its highest price of $0.0033 on January 5, 2022, and its market capitalization, which was once $1 billion, has now fallen to $34.5 million. of dollars.
Several former SafeMoon supporters expressed frustration on Reddit in reflection of the bankruptcy, claiming that SafeMoon developers had harassed them.
"The fact of the matter is that everyone has been scammed by the SafeMoon developers, including the mods who supported and trusted SafeMoon." saying Reddit user Jtenka.
Another Reddit user, "anonyamon42069", saying: โI never even want to talk about how badly we were all scammed and especially the money I lost. To the idiots who still think SafeMoon has a chance and will 'go to the moon': get help.โ
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Santiago Melgarejo, former non-fungible token analyst and sales specialist at SafeMoon, said in reflection that the โwarning signs were thereโ all along, particularly when many of the employees were abruptly laid off even though many of them worked a month without pay.
I recently learned of SafeMoon's bankruptcy filing and my thoughts are with my former colleagues who have not been paid for a month and with the incumbents who are facing frustration and anger.
In retrospect, the warning signs were there, particularly when many of us were abruptly laid off by various...
โSanti (@Santi_NFT) December 14, 2023
SafeMoon was also exploded in Marchresulting in a net loss of $8.9 million.
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