The token of decentralized finance protocol SafeMoon (SFM) has fallen 31% in five hours after the company filed for bankruptcy.
SafeMoon officially filed for Chapter 7 bankruptcy protection on December 14 filed In the United States Bankruptcy Court for the District of Utah. The voluntary petition was filed by attorney Mark Rose before Chief Judge Joel T. Marker, assigned to the case.
screenshot of a Letter A letter purportedly written by the firm’s chief restructuring officer to employees surfaced on Reddit, explaining that due to its bankruptcy it was not able to pay salaries to employees before the filing.
“You must file a claim with the bankruptcy court for your unpaid wages,” the document reads.
The latest blow comes just a month after the United States Securities regulator charges SafeMoon, In November its founder Kyle Nagy, CEO John Karoni and CTO Thomas Smith to violate securities laws What the regulator described as “a large-scale fraudulent scheme”.
The cryptocurrency dropped from $0.000065 to $0.000045 at 8:24 pm UTC on December 14 in a five-hour period following the news. According To CoinGecko. However, it bounced back to $0.000061 in a rapid 10-minute period.
SMF dropped 31% immediately after the bankruptcy filing and then recovered slightly. SFM is currently changing hands for $0.00005729. The token is down 98.2% from its peak price of $0.0033 on January 5, 2022, and its once $1 billion market cap has now fallen to $34.5 million.
Many former SafeMoon supporters expressed disappointment on Reddit in reflection of the bankruptcy, and alleged that SafeMoon developers had swindled them.
“The truth of the matter is that everyone has been deceived by the SafeMoon developers, including the mods who support and trust SafeMoon.” Said Reddit user Jtenka.
Another Redditor, “anonyamon42069,” Said: “I never want to talk about how bad a scam we all got into and especially how much money I lost. For those idiots who still think SafeMoon has a chance and will ‘go to the moon’: get help.
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Safemoon’s former non-fungible token analyst and sales specialist, Santiago Melgarejo, said in reflection that “the warning signs were there”, especially when many employees were suddenly fired while many of them were working a month without pay. Were.
Recently learned of SafeMoon’s bankruptcy filing, and my thoughts are with my former colleagues who have not been paid for a month, and the holders facing frustration and anger.
Looking back, the warning signs were there – especially when so many of us were suddenly fired upon…
– Santi (@Santi_NFT) 14 December 2023
there was also safemoon exploited in marchResulting in a net loss of $8.9 million.
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