Fintech Rhubarb is insolvent
Scholz ‘nephews go bankrupt with crypto app
By Christina Lohner
The founders of fintech Rubarb can advertise with a well-known relative: their uncle Olaf Scholz is said to be responsible for a serious investment. Recently, they promise up to 3.8 percent interest with a new crypto platform. But even these entrepreneurs are failing in the crypto market.
Of course, the crisis in the crypto market does not stop at well-known names. Brothers Fabian and Jakob Scholz, nephews of Chancellor Olaf Scholz, wanted nothing less than to democratize investments with their fintech and the Rubarb app. “More money for your dreams” is written on the website. But after less than two years, the company filed for bankruptcy, as reported by “Handelsblatt”.
Funding commitments had been withdrawn, Fabian Scholz told the newspaper. Now it is about “being able to use the insolvency law’s restructuring options at an early stage”. The founders had just launched their new platform Kudona, which promised to make money in the easiest way in the so-called DeFi area, ie in the decentralized financial sector, where there is speculation in tokens. The principle of Kudona: Users’ money is put into stable coins lent on DeFi platforms. In return, operators promised up to 3.8 percent in interest rates.
The website still aims to become one of the largest financial companies in the world, financed by venture capital. According to the report, the brothers had collected a total of 4.8 million euros for Rubarb. Savers can invest in stocks and bonds via the app of the same name. Kudona is organized as a 100 percent subsidiary. According to Fabian Scholz, Rubarb will no longer be able to pay wages by the end of July. Almost half of Rubarb’s workforce is to go, according to information from “Handelsblatt”.
The whole industry is suffering
Investors should have been worried for a week at the latest when the founders mentioned the “crypto winter” in a letter to them. One of the donors was outraged by the newspaper: “How can you run the store to the wall from a fundraising in February in less than five months?” It is possible that he was dazzled by the relationship with the chancellor when he assessed the team, the investor admitted. “I thought they could not make the Wild West there.”
Market analyst Timo Emden, who specializes in cryptocurrencies, is not surprised by the bankruptcy. After all, the whole industry is suffering, especially in the DeFi sector, several companies have collapsed in recent months. “And the number of unreported cases should be very high,” Emden said in an interview with ntv.de. Due to the crisis in the crypto market, “all business models are being put through their pace, investors are reconsidering their decisions and withdrawing their money if in doubt”. Because there were further downside risks. “The deeper the market as a whole, the more companies face existential difficulties,” states Emden.
Crypto-critic Jürgen Geuter is not upset by the market shake-up in the DeFi space. In an interview with ntv.de, the freelance computer scientist and consultant said that “there were actually no reputable providers”. He calls for regulation of the market. Olaf Scholz, on the other hand, is unlikely to be happy about the Rubarb bankruptcy when his nephews once announced their uncle’s job as finance minister. Investors and the media showed interest. “Uncle Olaf Scholz and the Stock Market Attraction” was the headline in “Frankfurter Allgemeine”. ntv.de also reported: “Scholz’s nephews are planning a stock revolution”.