Crypto Bear Market Claims Scalps: These Projects Bow Out
The chilling winds of crypto winter continue to sting projects, prompting several of them to take a hard look at downsizing or ceasing operations entirely.
A decentralized content-sharing and publishing platform – LBRY – is the latest one to succumb to the market condition. The company behind the LBRY blockchain said that “there is no escaping this.”
LBRY Shuts Shop
In a somber announcement, LBRY weighed in on losing judgment to the federal government and said it has debts to the US Securities and Exchange Commission (SEC), its legal team, and a private debtor that it cannot pay. As a result, its assets, including Odysee, are now under receivership.
At the time of this statement, all executives, employees, and board members of LBRY have resigned. They are committed to fulfilling any outstanding legal obligations but will not be involved beyond those requirements.
The company now fears that the LBRY blockchain, which is decentralized, might die, too.
“Decentralization isn’t magic – it only works if enough people use it. Could LBRY still swallow all digital publishing like we intended? Could this be the beginning of a descent to obscurity? Who knows? It’s not like we’re LBRY experts.”
LBRY said it will not be continuing its appeal against the financial regulator.
The blockchain company had previously disclosed its intention to conclude operations in July following a final SEC judgment. The regulator had initially pursued a penalty of $22 million but subsequently revised it down to $111,000 upon recognizing LBRY’s financial inability to meet the larger sum.
In September, LBRY filed an appeal with the United States Court of Appeals for the Second Circuit seeking to challenge the final judgment, arguing that the SEC’s verdict was flawed.
Projects Close as Winter Bites
Earlier this week, SuperDao, the platform facilitating community-driven decentralized autonomous organizations (DAOs), revealed its decision to cease operations and refund any remaining funds to investors. It cited “lack of profitability” as the reason behind its decision.
In its 2021 seed round, the company secured $10.5 million in funding, backed by SignalFire, Circle, and One Block Capital. SuperDao initially aspired to secure advertising space at the 2022 Super Bowl, but competitors such as FTX and Crypto.com secured multi-million dollar deals ahead of them.
Decentralized finance platform Yield Protocol also announced shutting operations, citing low demand in addition to regulatory hurdles. It had revealed coming to a conclusion after extensive deliberation with various stakeholders.
The bear market did not spare NFT platform RECUR, which called its quits after $50 million in an investment round nearly two years ago.
Unfavorable market conditions and financial challenges also claimed Nifty’s, a platform dedicated to Web3 creators, which declared winding down operations in August. The team had strategically shifted its focus towards crafting a platform designed for Web3 creators and, to that extent, was actively seeking the necessary capital to sustain its efforts.
However, the investment prospects they pursued failed to materialize, pushing the company to the edge of its financial capabilities.
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