Kyber Network Lays off Half of its Staff

Just under a month ago, the Kyber Network DeFi platform was hacked by an unknown party who made off with $46 million worth of stolen assets – mostly in the form of DAI, WETH, and ARB.

Failed Negotiation Attempts

The attack – which was carried out by a hacker who explained the steps they took in a humorous tone – and the subsequent user asset migration brought the platform’s TVL to only $7.6 million. Before the incident, this figure hovered around $86 million.

After threatening to postpone negotiations due to a lack of deference shown by the Kyber team, the attacker made their offer – a complete buyout of the platform at a fair valuation.

“You haven’t done anything wrong. It was just bad luck. […] I know this is probably less than what you wanted. However, it is also more than you deserve.”

Naturally, this proposition was denied. Until now, other attempts at retrieving the funds have also been unsuccessful. As a result, Kyber Network must now reimburse users out of pocket to the best of their ability.

Platform Development to Be Stalled

Given the size of the sum needed to provide refunds, Kyber has had to resort to extreme cost-cutting measures.

On the 20th of December, Victor Tran announced that users would be reimbursed for up to 100% of their stolen funds.

We are doing our best and we are sacrificing a lot for it https://t.co/7DRWANAq7H

— Victor Tran (@vutran54) December 20, 2023

At the time, no further information was provided regarding where the funds to make the users whole would come from.

However, on Christmas Day, the CEO announced that development on the platform’s liquidity protocol initiatives and on KyberAI would be temporarily halted. An even more drastic cost-cutting measure was also taken – namely, a major workforce reduction.

“We have also made significant changes in our business operations to ensure we are well positioned to continue on a sustainable path forward, including temporarily pausing our liquidity protocol initiatives and KyberAI project.

Regrettably, we have also reduced our workforce by 50%. The past few days have been among the most challenging in my journey as an entrepreneur. The decision to part ways with so many of our team members was heart-wrenching.”

Tran promised to set up resources that would allow former Kyber employees to look for new jobs in the sector with relative ease and hopes that other crypto platforms with more cash to spare will pick up the amazing talent that he used to employ.