Sei considers the acquisition of 23andMe to protect genetic data privacy.

The organization behind the layer-1 blockchain Sei has announced that it is considering acquiring the genetic testing company 23andMe after the business filed for bankruptcy.

In a post on X on March 27, the Sei network announced that they are considering acquiring 23andMe in order to "protect the genetic privacy of 15 million Americans" by putting the company's data on the blockchain. If the deal is successful, Sei plans to implement all genetic information on the blockchain and "return ownership of the data to users through encrypted, secure transactions."

"The organization believes that user data sovereignty is a matter of national security," Sei's statement said. "When a pioneering American biotechnology company faces bankruptcy, the personal genetic data of millions of people will become vulnerable to parties that may not share the same values regarding transparency and open access."

This announcement comes four days after 23andMe announced it had filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Eastern District of Missouri. The company asserts that there will be "no changes in the way it stores, manages, or protects customer data," which includes genetic information for approximately 15 million people worldwide.

The bankruptcy of 23andMe has raised many concerns about data privacy in an era where companies hold the genetic information of millions of people.

After the information about the bankruptcy emerged, New York Attorney General Letitia James and California Attorney General Rob Bonta called on 23andMe users to contact the company to request the deletion of their personal data, emphasizing privacy rights and the right to request the destruction of DNA samples. The two officials stated that state laws ensure users have control over their data.

23andMe: From "Giant" to Bankruptcy

Before filing for bankruptcy, 23andMe had gone through a long period of decline, burning over 1 billion USD and laying off more than half of its staff. The board of directors collectively resigned in September 2023 due to disagreements with CEO Anne Wojcicki's strategy.

Despite losing control of voting shares after the company went bankrupt, Ms. Wojcicki remained determined to find a way to buy back the business. Initially, she succeeded in popularizing at-home DNA testing services, but the strategy of expanding into drug development and healthcare led the company to spend hundreds of millions of USD without generating profit.

After going public in 2021, 23andMe was once valued at over $6 billion but could not maintain a recurring revenue stream as customers only needed to take an ADN test once. Diversification efforts, such as acquiring Lemonaid Health for $400 million or launching the 23andMe+ service, were all unsuccessful.

When cash flow ran dry, the company implemented several rounds of layoffs. By April 2024, the stock dropped below 1 USD. Ms. Wojcicki proposed privatization but was rejected by the board of directors. Immediately after 23andMe filed for bankruptcy, the stock plummeted 60%, down to just 0.73 USD.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should conduct thorough research before making decisions. We are not responsible for your investment decisions.

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Wang Qian

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