Spondoolies-Tech Ltd., an Israel-based transaction verification server manufacturer, last week announced that it has ceased its operations. In a Facebook post, CEO Guy Corem wrote:

“To our valued customers,

As of May 4, 2016 Spondoolies-tech has ceased operations.

It has been a great privilege to serve the Bitcoin mining community and especially our customers. We deeply appreciate the support and faith that you have placed in us and wish you success in your future endeavors.”

Earlier in February, blockchain technology focused company BTCS Inc. and Spondoolies announced that they received merger approval from the Israeli Office of Chief Scientist (OCS). The companies entered into a definitive merger agreement last year and closing of the merger required the OCS approval as well as the confirmation from the Israeli Tax Authority regarding deferred payment of applicable Israeli taxes related to the transaction.

Finance Magnates reported that seven Spondoolies employees turned to the court with a request to dissolve the company after receiving a notification from the management that they will not receive their last salary payments and that the firm can no longer afford to retain them. The notification mentioned that the company suffers from a lack of credit and funding and most likely to go bankrupt in early May.

The insolvency of Spondoolies is particularly surprising as the firm won a 3 million shekel grant from the Chief Scientist of Israel and generated $28 million in sales in 2014. Finance Magnates noted that competition with the dominant Chinese Bitcoin mining equipment producers proved “too tough”, in the absence of an adequate credit pool.