On Friday, Peng Zhong, CEO of Ignite, the firm behind the Cosmos blockchain ecosystem, announced his departure. Zhong's retirement comes only a few months after the company's name was changed from Tendermint to Ignite as part of a reorganization strategy.
Tendermint renamed to “Ignite” in February to bring about new change and activity within the firm.
Ignite was further divided into two businesses in late May: Ignite and NewTendermint. During that month, the company was split into two business entities due to the return of Jae Kwon, the original co-founder of Ignite.
Mr. Kwon, Ignite's original co-founder, rejoined his old team as CEO of NewTendermint, while Mr. Zhong, Ignite's current CEO, remained CEO of the newly restructured Ignite.
Kwon's return to the organization is thought to have prompted Zhong's resignation.
In 2014, Kwon co-founded Ignite and its parent business, All In Bits Inc. After bitter disagreements with some of Tendermint's employees, the executive stepped down as CEO in 2020, but he retained a seat on the parent company.
With the split, NewTendermint was formed with the intention of contributing to the core technology of the Cosmos blockchain ecosystem, while Ignite remained focused on blockchain-based product development.
Peng, who has a background in interaction design and front-end engineering, was responsible for guiding blockchain development across the company. As a result, his abrupt departure raises concerns about the prospects of Ignite and New Tendermint.
Meanwhile, other reports indicate that Ignite has announced massive job cuts affecting more than half of its employees this week. The announcement comes after Ignite CEO Peng Zhong announced his departure from the company on Friday.
The resignation of several other top executives at Ignite calls the company's future into question.
While Ignite lay off some employees, others agreed to leave in exchange for severance pay.
Some may have left voluntarily after details about the new organizational structure between the two entities remained hazy for several weeks after they were announced.
Mr. Kwon mentioned the impending employment losses when he returned to the firm in May. Upon his return, he announced that certain employees would be offered severance payments.
Job losses are a result of the bear market
According to sources acquainted with the subject, the recent crypto meltdown pushed Mr. Kwon to reduce the company's personnel more than intended.
The ongoing crypto crisis has created a great deal of FUD (fear, uncertainty, and doubt) in the community, not only among investors but also within businesses. Crypto firms like as Crypto.com, BlockFi, Coinbase, and Gemini, among others, have laid off hundreds of employees amid a cryptocurrency crash and a drop in token prices.
The crypto winter, caused by the collapse of the Terra/Luna ecosystem, has left everyone in limbo, with no idea when it will end.
The majority of businesses appear to be blaming the current market conditions. Several coins' prices have dropped as a result of a new wave of selloffs. Due to the adverse market conditions, some cryptocurrency firms, including Celsius, BlockFi, and Three Arrows Capital, have had severe financial difficulties.
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