Foundation NEM announces restructuring and financing plan to avoid bankruptcy.
The NEM Foundation does not give for more. According to its new president, Alex Tinsman, after the last administrative exercise, the non-profit organization that is in charge of the protocol and development of cryptoactive technology is on the verge of financial collapse.
According to an open letter published this January 30 by Tinsman, the NEM Foundation has not had an adequate structure for global expansion, duplicating efforts and with an investment return that has been questioned, especially if the foundation seeks to remain operational in the “Cryptoinvierno”, as he has called his own expectations about the near future of the market.
“The NEM Foundation faces difficult budgetary decisions. We are in a difficult situation like many other members of this ecosystem, “wrote Tinsman, who was elected in December 2018.
The new budget of the foundation has been estimated with a reduction of 60% of 9 million dollars per month, that is, only the equivalent of 3.6 million dollars in XEM will be spent.
Likewise, Tinsman said that they would request funding from the NEM 160 million XEM community fund (almost 7 million dollars), which would be used to rescue the organization, which is close to bankruptcy.
The restructuring will be profound, and will even change the business approach. They will go from a strategy that had been from promotion and marketing to one focused on the product. The idea is to give priority to the teams of development and improvement of the product, and that these replace the regional teams and their management as part of the foundation.
“The reality that we have one month of funding means that we can not support our staff, associations and current projects. We need to put everything on hold. This is painful, since it affects people and partners.”
In addition to this break in the management of the foundation, employees and contractors who maintain a commercial or labor relationship with the foundation must report to one of the seven production teams that will be established.
The directors of technology, product management, finance, business development, operations, marketing and revenue will be responsible for these teams, and those who must give their approval to the reports. In addition, they must deliver their results to the foundation. “We are greatly reducing promotional expenses and adding an aggressive set of technological features to the product,” Tinsman emphasized.
CriptoNoticias spoke with Regional Head Latam and member of the Council of the Foundation, Pedro Gutiérrez. He said the request for resources is part of the normal process that takes place after the election of a new government for the foundation. He also stressed that only in the event that resources are denied the foundation could close operations.
Regarding Latin America and what the region can offer during this period of the bear market, Gutiérrez pointed out that it is still an area of great potential, especially because of the governmental, academic, community and business ties that have been reached.
“LATAM continues to be one of the most prominent regions from the point of view of business development, because our professionals in the region have done a great job with governmental, academic and private company approaches,” he said.
NEGATIVE REACTION IN THE MARKET
However, despite the hopeful message with which the new president of the NEM Foundation finalized his letter, the price of the cryptoactive product has suffered.
Through Reddit, users have shared unencouraging comments on the subject, and in fact several said they sold their XEM holdings.
Currently each XEM has a price of 0.042593 dollars, which represents a drop of more than 10.8% in the last 24 hours. The main exchange markets for the cryptoactive are Kryptono, Binance and Exrates, and are mainly exchanged against ETH and BTC.
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