ICO Industry Woes Continue as Ambisafe Struggles Amid Bear Market, Trims 70 Members from Team
Last year was unkind to the entire cryptocurrency market, at exchanges shut their doors and coins lost substantial value. Ambisafe was one of the unlucky ones. With the ICO business suffering during the bear market, there was little use for an ICO services company. Though the company managed to start the year with 120 staff members, the 2018 market resulted in a cut of 70 people.
Ambisafe was founded in 2015, offering back-end solutions to the companies that primarily deal with white-labeled wallet and token sale platforms within the blockchain industry. Ambisafe was also responsible for offering other services, like acting as an exchange, auditing smart contacts, and the development of modular software. CEO Andrii Zamovsky commented that the company views themselves as “the infrastructure provider” to the financial market including blockchain technology.
Unfortunately, the company has seen some drops in the last two months of last year, as the company dropped from 120 people to just 50 people. Of the former 15 full-time staff members, there were ten that were laid off from the headquarters in San Francisco. In the Ukraine-based Ambisafe office, a total of 60 contractors were laid off.
Explaining the layoffs, Zamovsky commented that they were simply “hiring too fast.” He added that there are some projects that he did not agree that the company should take on, despite rising to $500,000 in monthly revenue when the initial coin offering was doing well. However, as the local regulators put restrictions on these ICOs to deter the public from using them, the company lost out and demand dwindled.
At this point, despite the bad news, Zamovsky corresponded with CoinDesk to let the publication know that their monthly revenue is about $100,000 monthly, and that a lot of the focus now is based in security token sales. These sales allow companies to register with the United States Securities and Exchange Commission (SEC) and sell their tokens, without violating any guidelines.
Zamovsky added that the big lesson learned here is that the transition from ICO to STO did not happen quite the speed that the company anticipated. Despite having full confidence that security tokens will be “the future,” there has yet to be enough activity to sustain the same number of employees.
Though reports from CoinDesk show that the publication sought out comments by former employees, but they were met either with denials for comments or received no reply at all. The only response came from a former contractor who did not see his contract renewed. However, he had no actual qualms about the company. Another former employee had a non-disclosure agreement and could not speak about their interactions.