A sad ending for Israeli Bitcoin mining equipment producer Spondoolies-Tech. The firm has been dissolved by a court in southern Israel after it failed to pay its employees since April.
Founded in 2013 by a group of Israeli high-tech veterans and cryptocurrency champions, Spondoolies has raised about $12 million to design high efficiency dedicated Bitcoin mining rigs. Last December BTCS (OTCMKTS:BTCS) which merged with Spondoolies invested another $750,000 in the firm and it was hoped that the increased cash flows would make for a more stable combined entity. Now it seems the extra funds did not even last for half a year.
A group of seven Spondoolies employees turned to the court with a request to dissolved the company after they were notified by management they will not receive their last salary payments and that the firm can no longer afford to retain them. The notification mentioned that Spondoolies suffers from a lack of credit and funding and most likely will go bankrupt in early May.
The employees asked the court to appoint a temporary liquidator for Spondoolies in the hope that she will be able to find a new investor or someone to buy out the firm, or parts of it.
Spondoolies was once considered a very promising cryptocurrency company with clients around the world, and even now all its machines are out of stock. It also won a 3 million shekel grant from the Chief Scientist of Israel and generated $28 million in sales in 2014. Despite all of this, competition with the dominant Chinese Bitcoin mining equipment producers proved too tough without a grater credit pool.