Paradigm, a crypto-focused venture capital firm, is losing its staff as the market is embracing for tough times triggered by a cascade of bankruptcies.
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According to a report from The Information, the San Francisco-based firm has lost "at least" eight employees, including two investment partners, starting from October 2022. While it is unclear what was the reason behind the re-organization nor how many people left the firm, the report notes the exits made up a "significant portion" of Paradigm's engineering and investing staff.
In November last year, shortly after FTX collapsed, Matt Huang, the Co-Founder and Managing Partner of Paradigm, said in a Twitter thread the firm was shocked by the revelations about FTX, Sam Bankman-Fried's hedge fund Alameda Research, and SBF himself.
The blow-up of FTX has caused some to question crypto’s value. But the issues at FTX are precisely ones that decentralized finance can solve through increased transparency and security. Crises such as this one help to clarify the true merits of what we’re all building towards.
— Matt Huang (@matthuang) November 15, 2022
Huang added that the firm felt "deep regret" for having invested in a founder and company who "ultimately did not align with crypto’s values and who have done enormous damage to the ecosystem."
In mid-February, Paradigm was mentioned in a class-action suit among other investors who backed the notorious crypto exchange. The plaintiffs claimed that VC firms "portrayed" FTX as a "trustworthy and legitimate crypto exchange" as they wanted to monetize on their investments.
According to data from Crunchbase, FTX raised a total $1.8 billion in several funding rounds, including more than $100 million from Thoma Bravoin and over $250 million from Paradigm.
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