Many FTX employees are expected to become rich as their Serum SRM token holdings increased in value in 2021.

But that upsets Sam Bankman-Fried, who has backed Serum, because it means those employees might not be willing to work 14-hour days at his cryptocurrency exchange, because they are now millionaires on paper.

So, Michael Lewis explains in his new book, “Going Infinite,” the FTX CEO changed the rules, locking up those SRM tokens longer so his employees had to wait to sell them.

Cryptocurrency companies and protocols often compensate employees by giving them a number of tokens, with the condition that they will be issued to employees according to a predetermined schedule. With highly liquid cryptocurrencies, it is important that insiders cannot sell them to retail investors as soon as the tokens start to gain momentum.

Locked tokens give the feeling that the team is in for the long haul. The exact schedule of this token unlocking is published as part of the project's token system.

Bankman-Fried has changed the SRM rules

In the 2020-2021 bull market, #SRM is a rising star. At that time, the token experienced a significant price increase after being listed on Binance, with the success attributed to its association with decentralized exchange Serum on the Solana blockchain and its association with Sam Bankman -Fried by FTX and Alameda Research.

SRM hit an all-time high of $13.72 in September 2021, making anyone in the pool allocated tokens at the launch price of $1.70 in August 2020 “rich.” ridiculous,” as Lewis wrote.

“In the employee Serum contract, he reserved for himself the right to extend Serum's "jail" period and he used it to lock out Serum of all employees for seven years. They now understand that if he changes the rules once, he can do it again. They become less enthusiastic about their Serum.”

SRM chart. Source: Coingecko

In the weeks following #FTX 's bankruptcy last November and the subsequent hack, Serum's SRM token increased in value as the decentralized exchange community initiated an emergency fork to addressing security concerns, given the token's uncertain future due to its relationship with FTX being compromised.

By the end of November, Binance had delisted the majority of SRM's trading pairs.

SRM is down 99.72% from its all-time high and is thinly traded on a half-dozen lesser-known exchanges.

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