Metaplex Layoffs: Solana Continues to Face Trouble After FTX Bankruptcy

The havoc for the Solana network does not seem to calm down soon. Prominent open source network had deep ties with the collapsed crypto exchange FTX. The native crypto asset SOL token has already suffered significant loss in trading price. Now another strike for Solana came in the form of its NFT protocol maker Metaplex’s laying off its employees. 

Co-founder and chief executive officer of Metaplex, Stephen Hess went on to Twitter to announce the reduction of working staff. Hess noted the company took a difficult decision to make several Metaplex Studios team members part ways. 

Although there was no mention of the total number of employees being laid off. 

In his seven Tweets long thread, Hess further added that given Metaplex being the Solana NFT ecosystem’s base layer, the platform is responsible for ensuring sustainability in the long term benefiting the community. 

While clarifying the measure for workforce elimination, Metaplex CEO stated that the treasury did not get an impact following the FTX collapse and “fundamentals remain strong” though. Yet the indirect impact demands “a more conservative approach” before taking any step ahead. 

Solana based NFT protocol Metaplex was created intending to offer an alternative NFT network that remained largely under the dominance of Ethereum network. 

In January this year, the protocol raised about 46 million USD in funding from Jump Crypto, Multicoin Capital and famous NBA player Michael Jordan. The funding was enough to give a significant push to the newly launched company, which landed in a while after maintaining a smooth initial journey.

After several months, Metaplex launched MPLX—NFT protocol’s native governance token. The move did not bring fruitful results given the launch timing amidst the bear market and the value tumbled. Slowly the eagerness around the Solana based NFT protocol calmed down. In amalgam with the growing debate around the royalties to creators, the NFT sales witnessed steep decline in October. 

The protocol was already dealing with the chaos, over which FTX filing for Chapter 11 Bankruptcy came along. Since Solana was very much praised by the FTX founder and CEO Sam Bankman-Fried, the impact of his image getting downgraded was on the assets and projects over the network. 

Fall of FTX created a ripple effect and went on to intensify the going beleaguered situation for the crypto market. Major cryptocurrencies Bitcoin (BTC) and Ethereum (ETH) dropped following it but had a drastic impact on Solana (SOL). SOL token witnessed about a 60% drop in its value during the similar timeframe. 

In addition, the organization behind the Solana network, Solana Foundation, had lost millions of dollars given its close ties with Sam Bankman-Fried. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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