Qredo enters administration following partial acquisition by Dan Tapiero's 10T and 1RT

Quick Take

• Dan Tapiero’s 10T and 1RT firms have acquired “substantial” assets of Qredo.
• The rest of the Qredo business has been placed into administration.
• Qredo has laid off 44 more people due to administration, a source told The Block.

A portion of the struggling crypto custodian Qredo QRDO +23.58% has been placed into administration after its partial acquisition by 10T Holdings and 1RoundTable Partners, growth equity firms led by veteran investor Dan Tapiero.

10T and 1RT said Friday they have acquired "substantial" assets of Qredo through their new U.K.-based entity, Fusion Laboratories. The acquisition comes after the two firms led Qredo's bridge financing round and reorganized the company late last year, they said — confirming The Block's previous reporting.

As part of the deal, 10T and 1RT will relaunch Qredo's acquired assets through Fusion Labs — focusing solely on Fusionchain, an upgraded version of Qredo Network on Cosmos. The QRDO token will move to the Cosmos ecosystem with Fusionchain's launch.

"The token migration will increase utility under revamped tokenomics," said 10T and 1RT. "Additional information regarding the launch of Fusionchain, the token migration, tokenomics, and strategic plans for Fusion Labs will be communicated in the near future."

Qredo placed into administration

Qredo appointed Ian James Corfield and Philip David Reynolds of FRP Advisory as its joint administrators on Feb. 1.

Company administration is a process aimed at rescuing struggling business segments or maximizing returns for creditors before dissolution. An insolvency practitioner takes control of the company during administration.

Qredo's joint administrators will communicate with the company's suppliers, creditors, and employees regarding the next steps in the coming days, said 10T and 1RT.

Meanwhile, the Qredo custody platform will remain "fully operational" until further notice, ensuring customers remain unaffected by these changes for the time being, according to a Qredo spokesperson.

Qredo fires more people 

Qredo has cut 44 more jobs, halted salary payments, and transferred the remaining 23 employees to Fusion Labs, a source with knowledge of the matter told The Block.

A Fusion Labs spokesperson confirmed that 23 people from Qredo have been brought to Fusion Labs. However, they did not comment on the number of employees laid off from Qredo.

"As the Company is no longer in a position to make payments for services rendered by you under your contracts, you should regard your service as terminated effective immediately," Qredo CEO Duncan Payne-Shelley wrote to the team in an email today that was obtained by The Block.

"Please be advised any amounts outstanding to you at the date of the Administrators appointment will be a claim against the company. The Administrators will be writing to you and all other known creditors of the company with details of how to submit your claim in due course," Payne-Shelley added, who has now moved to Fusion Labs as CFO.

Payne-Shelley did not immediately respond to The Block's request for comment.

Fusion Labs has a new CEO and board

Randy Little, a partner of 10T and 1RT, has been appointed as the new CEO of Fusion Labs.

Little, alongside Payne-Shelley, moved Qredo's chief technology officer, Jason Losh, its chief cryptographer, Kealan McCusker, and some other Qredo employees to Fusion Labs.

Some of Qredo's previous employees — including former chief operating officer Josh Goodbody and former vice president of marketing and operations Luis Vaello — moved to the QRDO Foundation, as The Block reported previously. Fusion Labs and Warden Protocol will both play important roles in the QRDO ecosystem, which is led by the QRDO Foundation, Vaello told The Block.

"The QRDO Foundation is thrilled about Qredo Ltd's acquisition by Fusion Labs, effectively dispelling any prior concerns in the community," Vaello said. "This week's announcement of Warden Protocol and Fusionchain's continued support for the QRDO token highlights an optimistic future. We are entering an exciting era of growth and innovation for the QRDO community," he added.

Tapiero will now serve as the chairman of Fusion's board, joined by Little, Tad Smith, a 10T and 1RT partner, and two undisclosed independent directors.

The Block extensively reported on Qredo's problems and 10T's rescue efforts for months. Today's news officially confirms the company's issues and reveals the roles of 10T and 1RT in its rescue.