Crypto Winter Forces NEM To Reorganize Non-Profit Organization
NEM (XEM) Blockchain team announced that it had totally overhauled its non-profit NEM Foundation amidst financial problems. The Foundation, which originally had a monthly spending plan of 9 million XEM (~$392,000), now, decides to spend less than half of the earlier planned amount, as a new simplified entity intends to reduce costs.
The announcement said “The NEM Foundation has restructured to eliminate regional teams and replace them with newly created product-focused teams.”
In summary, NEM affirmed that the “NEM Foundation you knew before is gone.” The motivation for the overhauls is reportedly due to a lack of financing and condemnation of utilizing money as per the old foundation model. XEM, the firm said, had a tricky year in 2018, losing a substantial portion of its value compared to previous highs, as an outcome of the continuing cryptocurrency bear market.
In its post, NEM said “In terms of running an effective organization, the existing structure failed. Maybe that didn’t seem like a big problem when the XEM price was high, but it’s a very big problem as we seek to sustain a viable organization in the ‘Crypto Winter’”.
NEM further added
“The XEM exchange rate has suffered catastrophic drops from this time a year ago, just as many other ambitious cryptocurrency projects have suffered, now the NEM Foundation is facing challenging budget decisions.”
At the time of writing this article, XEM/USD is trading at around $0.041, down 2.3% on the day. In January 2018, the pair hit a record high of $1.90.
However, in the last week of January, NEM was the major crypto that got swindled when the Japanese cryptocurrency exchange Coincheck was hacked. Rough estimates indicated that $530 million of funds, mostly in the form of NEM crypto, were looted at the time.
The announcement today did not mention major employee layoffs, separating it from companies such as Bitmain, ConsenSys and Shapeshift affected in recent weeks.