In today’s crypto world news, the NEM foundation is asking for money.
Top brass are contending that mismanagement by a board led by Lon Wong is the reason for some of the problems that NEM faces in a dynamic coin market. 202 foundation members will vote on the funding request soon. Layoffs are projected at NEM and there is significant concern about its future.
Is this a big deal?
With a market capitalization over $339 million, NEM is the 18th biggest cryptocurrency on the market, which is nothing to sneeze at. You could call it an “altcoin,” but it’s really a bit more substantial than most of those coins that have sprung up around the big three: BTC, ETH and XRP.
NEM was developed under the leadership of figures like Lon Wong, who had previous experience in Malaysian government. The NEM code is written in Java, with C suite modeling, and is billed as a ‘built from scratch’ code base that’s supposed to enhance the blockchain model with features like a mini-signature account method and a particular proof of importance algorithm that attempts to innovate the consensus model that blockchain coins are built on.
“This cryptocurrency is unique in many ways,” wrote Vivek Sancheti in a Cryptoground post explaining what’s behind NEM. “The goal of NEM is to create a more advanced blockchain technology. It has not only reduced the net requirement of energy for payments and transactions but also made the process simpler by removing the concept of mining. No powerful and sophisticated machine is required for its functioning. … It was to be created as a fork of NXT blockchain, but later the developers and the team of NEM decided to make a completely new model and write a different code. Its technology is planning to make the process of performing transactions simpler than ever. The system of NEM has the capability to drastically simplify a large variety of ledger and transaction systems.”
Lately William Suberg, another Cointelegraph writer had been analyzing some of NEM’s problems.
“The Foundation, which previously had a budget with a monthly burn rate of 9 million XEM (~$392,000), now plans to spend less than half that amount, as a new streamlined entity aims to cut costs,” Suberg wrote Jan. 31, citing “financial difficulties” there. “The impetus for the changes reportedly comes from a lack of funding and criticism of spending under the old Foundation model.”
These cautionary tales help to illustrate just how tricky it can be to wade into crypto, either as a firm or as a trader. Keep your eyes open and ears to the ground for the latest around cryptocurrency plays.