Massive Labs - Case Update

Kate Conneely and Rahul Goyal of KordaMentha have given an update on their administration of Massive Labs, a software development company that entered voluntary administration on 14 July. Launched in 2021, the company was building a digital marketplace to connects artists with their fans using blockchain technology. To finance the development of the marketplace, the company created and issued unique tokens in a process similar to an IPO. Over US $1.5 million was raised and the company commenced building and marketing its platform. Additional capital was required to complete the project, which proved difficult in 2022 - declining crypto-currency prices, increase regulatory scrutiny and reduced volumes of NFT sales together combined to reduce investors’ appetite for digital asset startups. Unable to source the necessary capital to continue, the decision was made to put the company into voluntary administration. The administrators worked with the company’s directors to explore a potential recapitalisation during the administration, but to date it has not been successful. The administrators are therefore recommending that the company be wound up. Token holders who participated in the company’s initial capital raise have been told that they will not be considered creditors of the company.