At least five crypto companies have shuttered this week as a prolonged downturn in the crypto market has put downward pressure on user activity and investor funding.
Crypto trading card platform Fantasy.top, cross-blockchain infrastructure company Everclear, and Ethereum layer-2 blockchain ZERO Network all announced Thursday that they were winding down, with their products failing to find the right fit in the market or sustain enough revenue.
This came the same week Ethereum infrastructure firm Syndicate Labs announced it was winding down after five years in a shrinking rollup market, and crypto ATM company Bitcoin Depot filed for bankruptcy in the US on Monday, citing financial strain and regulatory pressure.
Crypto companies have struggled this year amid a broad market downturn that has seen Bitcoin (BTC) fall about 40% from a peak of $126,000 in early October. Many public companies also reported losses in the first quarter, and the crypto industry has laid off more than 5,000 employees this year.
Fantasy.top posted to X on Thursday that it would shut down in June after two years of operations because its trading volume “was not sufficient to sustainably support long-term operations.”
The company added that it explored different products, such as prediction markets, to stay afloat, but “none reached durable market fit.”
Fantasy.top co-founder “Kipit” said the company failed because it “tried to put crypto on top of a model that was never built for crypto,” and attracted people “who want to make money from cards” instead of those who enjoy trading card games.
Source: Kipit
Meanwhile, Everclear said it was winding down the Everclear Foundation and Everclear Labs, the two organizations that help manage and develop the protocol, because it “never developed the commercial depth we needed” and couldn’t sustain meaningful revenue.
The protocol added that it explored various unsuccessful acquisition options and moved to a different model focused on partnerships, but had “underestimated how long it would take those partners to go live — and our runway ran out before they did.”
Everclear said it is considering open-sourcing its protocol to give its community the option of continuing to run it.
The token tied to Everclear fell sharply on Thursday after the protocol announced it was shutting down. Source: CoinGecko
Also on Thursday, the ZERO Network team posted to X that it was shuttering the network to focus on its sister crypto wallet and data service, Zerion.
“We launched ZERO believing users shouldn’t pay to transact on-chain,” said Zerion co-founder and CEO Evgeny Yurtaev. “We were obsessed with moving on-chain mainstream. We still are. But the world didn’t need more blockchains — it needs a better way to access them.”
Other recent crypto company closures include crypto mobile superapp Legend, which announced its closure on May 13. Solana aggregator Step Finance, crypto derivatives protocol Polynomial, crypto lending protocol Seamless and Balancer Labs, the team behind the Balancer protocol, have also closed due to the fallout from hacks or for a lack of market fit.
NYDIG research lead Greg Cipolaro said in February that the number of crypto projects that can attract investors is shrinking, with only applications or services that “extend traditional finance products onto blockchain infrastructure” getting the most attention.
Crypto platform Hyperliquid, popular for its crypto perpetual futures, has seen continued interest, pushing its token above $62 on Thursday, according to CoinGecko.
Prediction markets such as Kalshi and Polymarket, which use blockchains, have also seen continued growth in trading volume, recording a combined record monthly volume of $23.8 billion in April, according to Token Terminal data.
Conversely, major public crypto companies, including Bullish, BitGo, Galaxy Digital and Coinbase, posted losses in their first-quarter results due to market conditions.
