Fantom’s FTM token recovered some of its loss during the morning hours in Europe following a plunge on Sunday after decentralized finance (DeFi) architect Andre Cronje and his business partner said they would no longer be involved in the crypto market as developers.
FTM dropped 8% in the past 24 hours to as low as $1.32 in early Asian trading hours, more than 60% below its lifetime high of $3.46 in October.
Foundation CEO Michael Kong addressed investor concerns in a tweet earlier today as prices fell. “The Fantom ecosystem consists of hundreds of developers building many great applications. They will continue,” he said. “Anton (Nell), who works with Andre, tweeted that they were 'terminating' 25 projects. This was misunderstood. They are 'terminating' their involvement, but handing over anything they run to the existing teams.”
Multichain and Solidex, among the largest Fantom projects by total value locked, will continue to operate with their existing team of developers, Kong confirmed. “These projects are not closing down development. Some of them have been running independently for years,” he said.
FTM gained 10 cents in the hours following Kong’s tweets. Meanwhile, the price volatility caused just under $6 million in losses to FTM-tracked futures, data shows.
Cronje was one of the many developers who built products based on Fantom and Ethereum, garnering a cult following. He was the key architect behind successful projects like Yearn Finance and Keep3r Network on Ethereum, and he also served as an adviser to the Fantom Foundation until last month.
Tokens of Ethereum-based Yearn, one of Cronje's first projects, boasted a market capitalization of over $3 billion at their lifetime peak, trading as high as $90,700 from lows of $31 in 2020, data show. In the past 24 hours, YFI dropped as much as 25% before recovering.
Yearn’s success fueled a "Cronje Effect" in crypto circles. In the past years, projects built by or associated with the developer have garnered millions of dollars within hours of their launch.
The frenzy included unfinished projects like Eminence, which attracted $15 million from investors even before a full rollout. It was ultimately exploited for the full $15 million before hackers returned $8 million to Eminence’s deployer address.
Meanwhile, Yearn developers suggested the YFI market had overreacted to the announcement as Cronje hasn't been involved in recent months.
“You do realize Andre hasn’t worked on it for over a year?,” tweeted pseudonymous Yearn developer Banteg. “And even if he did, there are 50 full-time people and 140 part-time contributors to back things up.”
YFI seems to have stabilized near $18,100 at the time of writing after falling from $19,500 on Sunday.
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