Everledger, a blockchain platform established in 2015 to trace the origin of high-value assets such as luxury items, diamonds, high-quality wine, and high-end fashion, has filed for bankruptcy after being unable to secure the expected investors’ funds, according to a report by Smart Company on May 8.
Tencent-backed Everledger enters voluntary administration
The platform raised $20 million in its Series A round led by Tencent, the Chinese tech giant that owns WeChat and had accumulated more than $51 million since its inception.
Moreover, Cai Yige, the former head of Tencent’s blockchain business, has left the company to found a Web3 wallet, following his departure at the beginning of the year, as per similar reports.
Tencent acquired a majority equity interest in Riot Games in 2011 and has a minority stake in Epic Games. In 2020, the Chinese tech giant led Everledger’s Series A round with a $20 million investment. It also matched the $3.5 million secured through the UK Government’s Future Fund in 2021. However, GMP Securities, Rakuten, and Fenbushi are among the other previous investors.
Despite earlier remarkable funding rounds, the latest round from an undisclosed investor failed to materialize, leading to Everledger’s voluntary administration. The Australian Financial Review (AFR) reported that the blockchain firm’s employees received redundancy notices on March 31, and Vincents Chartered Accounts was appointed as administrators. However, Everledger’s holding company, based in the UK, is not currently in administration, according to the AFR.
As noted by Smart Company, the first creditor’s meeting is scheduled to take place today. While it is unclear at this time whether the company will be able to recover, the outcome of the creditor’s meeting may provide more insight into the situation.
More startups bite the dust
Blockchain companies have faced significant challenges over the past 18 months, with tightened belts and regulatory scrutiny on the rise. The collapse of FTX in November 2022 has further exacerbated the situation, damaging the reputation of the blockchain and cryptocurrency sectors.
Everledger’s collapse is the latest in a series of Australian startups shutting down. According to the Smart company report, Milkrun, Providoor, CoLab, and BoozeBud have all collapsed in recent weeks.
The blockchain and crypto sector has seen other firms file for bankruptcy, including BlockFi, Voyager, and Celsius Network, among other once-leading players.