Amber Group, one of the leading crypto trading and lending platforms in Asia has just secured $300 million in fundraising amid a severe liquidity crisis as the collapse of FTX continues to reverberate across the digital assets industry.
This comes on the heels just a day after Amber told employees that the company is scrapping performance-based bonuses for 2022 due to slower business growth and market uncertainties. The Singapore based crypto outfit has also deployed several cost cutting measures including redundancies and wage reductions. As per reports, Amber has slashed its workforce to less than 400 from a peak of nearly 1,100 employees earlier this year. It seems the spillover from FTX’s spectacular fall is still hammering the crypto industry.
Fresh Capital to Compensate Customers
1) Today, we’re announcing that Amber Group has completed a $300M Series-C round, led by Fenbushi Capital US and joined by other crypto-native investors and family offices.
— Amber Group (@ambergroup_io) December 16, 2022
On December 16, Amber took to Twitter to announce that it had closed a $300 million Series C round led by Fenbushi Capital US, alongside other undisclosed crypto-native investors and family offices. The primary objective of the fresh capital is to compensate its customers who have lost money on Amber’s product as a result of FTX’s collapse. It is worth noting that Amber has previously confirmed to having almost 10% of its trading capital locked on FTX when withdrawals were first halted.
However the Asian crypto lender had assured its customers that it had no exposure to FTX’s token FTT or to sister firm Alameda Research. Amber had earlier planned to raise $100 million at a $3billion valuation but was forced to pause the deal due to the FTX blowup. Amber has previously confirmed,
“Post the FTX collapse, we paused [the series B+ fundraise] after a partial closing and instead moved forward on Series C.”
FTX Implosion Continues to Hammer Crypto Industry
Earlier this month, Amber had reportedly steered away from plans to expand in Europe and the United States in the wake of the FTX implosion. Annabelle Huang, managing partner at Amber Group had previously specified the company has been forced to deprioritize its new metaverse project due to the FTX contagion.
This came shortly after Huang denied allegations of Amber’s insolvency. On December 6, the executive responds to allegations that Amber was on the brink of insolvency, stating,
“We continue to operate business as usual. If you have any concerns, withdrawals are open as usual.”
It is. We continue to operate business as usual. If you have any concerns, withdrawals are open as usual.
— Annabelle Huang (@_annabellehuang) December 6, 2022
The FTX debacle has spread like a wildfire across the crypto ecosystem propelling a barrage of downturns. Investors and customers with exposure to FTX lost billions of dollars of funds. Cryptocurrencies tanked to unexpected lows with Bitcoin (BTC) dropping to a two year low. Several high-profile companies faced severe liquidity crunch such as crypto lender, BlockFi, which succumbed to the pressure and filed for bankruptcy.