Oxygen and Maps.me Future Uncertain as Majority of Tokens Locked on FTX

UTC by Benjamin Godfrey · 3 min read
Oxygen and Maps.me Future Uncertain as Majority of Tokens Locked on FTX
Photo: Unsplash

The current prediction is that the FTX implosion is going to be accompanied by quite a lot of distress calls from companies who either used the custody service provided by the firm or rely on its DeFi and earnings product to operate.

Oxygen and Maps.me, two of the Decentralized Finance (DeFi) projects backed by Alameda Research, the trading offshoot of the now-bankrupt FTX Derivatives Exchange are facing uncertain futures as the majority of their tokens are locked up on the trading platform. Once a very prolific investor, Alameda Research lead the funding rounds in both companies in January and February 2021.

While Alameda lead the $50 million in Maps.me, it also bankrolled Oxygen as the majority investor when it raised funds last year. With the mutual relationship that was built by the entities, the duo of Maps.me and Oxygen trusted FTX Custody for their tokens and as of the time the exchange filed for bankruptcy, approximately 95% of the supply is locked up on the platform.

“The MAPS.ME and Oxygen teams are shocked by events relating to FTX Group’s bankruptcy proceedings,” the platforms said in a statement, “Whilst FTX Group did not hold any equity [in the MAPS.ME or Oxygen businesses], it did hold a significant proportion of MAPS/Oxy tokens. It also acted as custodian for over 95% of the overall supply of our ecosystem tokens — both locked and unlocked.”

In the issued statement, the DeFi protocols said they have no insider information as to the bankruptcy process that is ongoing at this time and said the info it has is what is shared with the general public. While the protocols did not highlight in clear terms what this entire situation means for the future of its business, it did allay concerns by noting it has hired the services of legal advisors to assist with this ongoing process.

The startup promises further communications as soon as the developments surrounding the bankruptcy proceedings and its interests changes.

Beyond Oxygen and Maps.me: More Ripple Effect to be Recorded

The current prediction is that the FTX implosion is going to be accompanied by quite a lot of distress calls from companies who either used the custody service provided by the firm or rely on its DeFi and earnings product to operate.

Already, we have started seeing firms come out to highlight how exposed they are to the bankrupt trading platform with Ikigai Fund’s founder Travis Kling confirming the firm may not be able to proceed if it is unable to recover some of the funds that were being held on FTX.

The Wall Street Journal (WSJ) reported on Tuesday that crypto lending platform, BlockFi may also file for bankruptcy after acknowledging that it has funds locked up in FTX and that it has an undrawn line of credit from the trading platform.

The FTX situation has taken a very massive toll on the industry and the trust that many investors have built over the years has now been smashed, with stakeholders working hard to regain it with transparency and concerted support to those most affected by the bankruptcy.

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Benjamin Godfrey

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.

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