Israeli Blockchain Startup Faces Financial Crisis
TEL AVIV, Israel — April 9, 2025 —
Unruly Technologies, a Tel Aviv-based crypto and blockchain development firm, has filed for insolvency after failing to recover from the catastrophic crash of its native digital asset, the Spacemesh token. The announcement follows the termination of all remaining employees on March 11, marking the collapse of one of Israel’s most well-funded crypto ventures.
Debt Disclosure and Legal Proceedings
Unruly Technologies filed its insolvency request with the Tel Aviv District Court. Legal representatives from Gornitzky & Co.—attorneys Karen Reichbach Segal, Guy Ido, and Avishai Sender—detailed the company’s liabilities, which include nearly 1 million shekels owed to former employees, 500,000 shekels to suppliers and consultants, and approximately $1 million in loans from the company’s founders: Tomer Afek, Rami Kasterstein, and Aviv Eyal.
Despite raising $24.5 million from private investors, the company was unable to generate sufficient traction or revenue to sustain operations.
Spacemesh Token Value Plummets by 1,750%
The Spacemesh cryptocurrency, once hailed for its innovative consensus model and decentralization goals, saw its market value fall from $0.70 in November 2024 to $0.032 in early 2025. That 1,750% drop undermined investor confidence and severely impacted the company’s valuation.
Analysts have attributed the collapse to an overconcentration of coin mining in a single region in China, contradicting the project’s decentralization ethos and prompting concerns of centralized control.
Investors Express Long-Term Commitment
In a public statement, the company emphasized ongoing investor support, noting: “Investors in the company believe in the importance of our open-source, publicly accessible technology for the benefit of the public and humanity at large. They remain committed to the mission and believe in the potential to rehabilitate the company.”
Implications for the Crypto Sector
Unruly’s insolvency highlights the growing risks faced by blockchain startups amid market volatility and technical shortcomings. The situation underscores the importance of decentralization, transparency, and tokenomics in sustaining long-term crypto projects.
