Star Atlas maker loses half of its cash due to FTX crisis

ATMTA, the developer of “Star Atlas,” a metaverse game set in the year 2620, said its cash runway has been reduced by a half due to its exposure to the cash-strapped crypto exchange FTX. 

On November 11, FTX filed for bankruptcy proceedings in a U.S. court while its chief executive Sam Bankman Fried resigned. The process would involve about 130 affiliates including its Japanese subsidiary FTX Japan.

In a statement posted on Twitter, ATMTA chief executive Michael Wagner admitted that a portion of the company’s liquid cash assets were impacted by the FTX crisis. “While previously we had multiple years of runway given current operations ahead of us, that has presently been reduced by approximately one half,” he wrote.

ATMTA had no choice but to prepare to make internal structural changes in order to continue its vision for the Star Atlas project, Wagner said, as the likelihood of securing a loan now is low.

However, he said the company maintained a strong balance sheet and options were available to enable it to stay the course. Its core product development and delivery pipelines remained unchanged while ATMTA was doing everything within its capabilities to retain its talent, he said.

Meanwhile, on November 14, FTX Japan revealed its financial position on its website. As of November 10, its cash holdings were at about 19.6 billion yen. Its net assets were worth about 10 yen as of late September. The crypto assets and legal tender entrusted by customers are managed separately from its assets, the Japanese subsidiary said.

Star Atlas is positioned as a next-generation gaming metaverse that combines blockchain, real-time graphics, and decentralized financial technology. It is set in outer space where players compete for spacecraft, materials and other NFTs.