Another cryptocurrency company goes bankrupt

The lending unit of US cryptocurrency firm Genesis filed for bankruptcy protection this week, becoming the latest digital asset firm to fail after the collapse of “stablecoin” terra USD and its sister token Luna last May.

Here is a list of major cryptocurrency companies that have since gone bankrupt.

Crypto carnage

Capital of the Three Arrows: The crypto hedge fund defaulted on a crypto loan worth more than $650 million soon after the terraUSD-Luna crash and filed for bankruptcy on July 1, 2022.

Traveler: The US cryptocurrency lender filed for bankruptcy just five days after the bankruptcy of Three Arrows Capital.

Celsuis: The cryptocurrency lender filed for bankruptcy on July 14 after falling victim to the terraUSD-Moon crash.

FTP: The collapse of FTX, the second largest cryptocurrency exchange in the world, shocked the world in November. Founder Sam Bankman-Fried was arrested in the Bahamas and extradited to the United States after a long delay, during which he embarked on an ill-advised media tour. Earlier this month he pleaded not guilty to criminal charges.

Genesis: One of the largest cryptocurrency lenders in the world, Genesis froze withdrawals in November after the spectacular crash of FTX.

BlockFi: The crypto lender filed for bankruptcy in late November, two weeks after FTX collapsed, as it had substantial exposure to the crypto exchange. Another victim of the terraUSD crash, it had been relying on a $400 million credit line from FTX to remain solvent after Voyager and Celsius went bankrupt in July.

With contributions from agencies


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GoMechanic financing

The undoing of GoMechanic

On Jan. 18, one of the founders of automotive service startup GoMechanic, Amit Bhasin, admitted in a LinkedIn post that there had been false financial statements at the company. He also said the company was laying off 70% of its employees and the board had launched a forensic audit of the company.

ET reported earlier that day that SoftBank and Malaysian sovereign wealth fund Khazanah pulled out of GoMechanic’s funding after an EY due diligence (DD) report uncovered clear loopholes in the company’s financial reporting and overall business. .

GoMechanic history

‘I admit’: Bhasin took to LinkedIn to admit that the founders have “carried away” in their attempt “to survive the inherent challenges of this industry and manage capital.” “We made errors of judgment while tracking growth at all costs, including with respect to financial reporting, which we deeply regret,” he wrote.

GoMechanic Financials

Discrepancies reported: Pricewaterhouse, GoMechanic’s fiscal 2020 auditor, had pointed to discrepancies in how the startup reported its business and assets, regulatory filings reviewed by ET showed.

GoMechanic Shareholders

More layoffs in 2023

layoffs

Google’s parent company Alphabet announced on Jan. 20 that it plans to cut about 12,000 jobs or 6% of its global workforce. The layoffs will affect jobs globally and across the company, chief executive Sundar Pichai told employees in an email Friday, writing that he takes “full responsibility for the decisions that got us here.” .

Microsoft announced on Jan. 18 that it plans to cut nearly 10,000 jobs or nearly 5 percent of its workforce by the end of the third quarter of fiscal 2023 in an effort to save $1 billion in costs.

Back home, MohallaTech, the parent company of vernacular social media platform ShareChat and short video app Moj, has laid off about 20% of its staff or over 500 employees in a new round of layoffs.

And Swiggy will lay off 380 employees, CEO Sriharsha Majety told employees in an internal memo on Friday morning. Majety said the company’s food delivery business has grown more slowly than expected. He also said the company took over the last two years due to “a case of poor judgement” on his part.

Read the full text of Sriharsha Majety’s email to Swiggy employees here

Startup layoffs

Meanwhile, virtual and hybrid events platform Hubilo has laid off about 120 employees, or 35% of its workforce, after seeing “degrowth” in 2022. This was Hubilo’s second such exercise in less than a year. year after reducing 12% of its total employee count in July 2022.

Read also: Dunzo, ShareChat, Rebel Foods to conduct layoffs during funding winter


ET Ecommerce Index

We have launched three indices – ET Ecommerce, ET Ecommerce Profitable and ET Ecommerce Non-Profitable – to track the performance of recently listed technology companies. Here’s how they’ve fared so far.

Ecommerce Tracker ET


Technical policy

Google CCI

Supreme Court rejects Google’s motion to suspend CCI’s order: In a setback for Google, the Supreme Court on Thursday refused to suspend an Oct. 20 order from the Competition Commission of India (CCI) requiring the tech giant to make changes to its Android ecosystem by Jan. 19. However, the apex court gave Google a one-week reprieve to comply with the ICC order. The court said the National Appellate Tribunal for Company Law (NCLAT) must rule on Google’s appeal by March 31.

CCI deny copy-paste: India’s Competition Commission on Thursday denied Google’s allegations that investigators “copied and pasted” parts of a European ruling against the US firm for abusing the market dominance of its Android platform.

The fees meet the main budget demands of gaming companies and cryptocurrencies: A streamlined tax regime is at the top of the list of demands made by gaming and cryptocurrency companies ahead of the upcoming budget. The online gaming industry has urged the government not to reduce the current Rs 10,000 TDS threshold, which is reportedly under review by the finance ministry.

Cheap wish list

Center open to more than one self-regulatory body for e-gaming: The government is open to the idea of ​​setting up more than one self-regulatory organization (SRO) to certify and operate online gaming companies, informed sources told ET. But this can come with stricter rules regarding SROs’ legal responsibilities, dos and don’ts, along with other regulations for who can form an SRO.

Read also | Government extends deadline for feedback on draft gaming rules


Funding news

PhonePe Financing

PhonePe raises $350 million in first tranche of $1 billion fundraiser: Major digital payments firm PhonePe said it raised $350 million in funding from global private equity firm General Atlantic at a $12 billion pre-money valuation, making it India’s most valuable privately held fintech company.

PhonePe milestones

The investment marks the first tranche of a fundraising of up to $1 billion that began this month, with other global and Indian investors also participating, the company said.

Digest ETtech offerings

Coffee company Blue Tokai rakes in $30 million from A91, others: Specialty coffee brand Blue Tokai Coffee Roasters has raised $30 million (Rs 245 crore) in its latest funding round, led by Mumbai-based investment firm A91 Partners.

Read also | ETtech Deals Digest: PhonePe’s $350M Funding Lifts Obscurity


In other news

IT recruitment

The top four IT companies report sharp declines in net hiring, the lowest in 11 quarters: India’s top four software exporters – TCS, Infosys, HCL Tech and Wipro – together reported a net increase of 1,940 employees in the quarter ended December 2022, the lowest in 11 quarters, as demand for technology services slows to due to global macroeconomic uncertainty and geopolitical concerns.

IT recruitment

Tata Tech starts working on IPO to raise up to Rs 4,000 crore: Tata Group has started the process to list Tata Technologies through an Initial Public Offering (IPO). The Tata Motors subsidiary is working with two consultants and is in the process of appointing another one, to help it raise Rs 3,500 crore-4,000 crore, valuing it at Rs 16,200 crore-20,000 crore ($2 billion-2.5 billion).

Delhi HC bars Ashneer Grover from creating ‘interest’ on disputed BharatPe shares: The Delhi High Court on Wednesday barred BharatPe co-founder and former chief executive officer Ashneer Grover from creating third-party rights or interests in the shares “transferred” to him by the company’s original co-founder Bhavik Koladiya. Koladiya filed a lawsuit to reclaim the disputed shares, saying Grover did not pay for the shares according to the agreement.

Oyo will refile the updated DRHP with Sebi by mid-February: Oravel Stays, parent company of Oyo, plans to re-submit its red herring prospectus project (DRHP) public listing application with Sebi by mid-February this year. The company had filed its DRHP for IPO with Sebi in September 2021 and aims to raise Rs 8,430 crore.

Graphics and illustrations by Rahul Awasthi

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