The team behind the Kadena blockchain said it is no longer able to continue business operations and will cease maintenance of the network immediately.
The native token behind the Kadena layer 1 blockchain plummeted 60% in 90 minutes on Tuesday after its founding team announced it was winding down and ceasing all network maintenance due to “market conditions.”
In a post to X on Tuesday, Kadena said it “is no longer able to continue business operations and will be ceasing all business activity and active maintenance of the Kadena blockchain immediately.”
“We are tremendously grateful to everybody who has participated in this journey with us. We regret that because of market conditions we are unable to continue to promote and support the adoption of this unique decentralized offering,” it said.
The “blockchain for business” branded layer 1 was founded in 2016 by JPMorgan’s former Blockchain Center of Excellence lead, Stuart Popejoy, and Will Martino, who worked as a tech lead for the Securities and Exchange Commission’s cryptocurrency steering committee before focusing his efforts on Kadena full-time.
Martino, Kadena’s former CEO, also worked at JPMorgan and helped create its first blockchain.
The shutdown shows how challenging it is for smaller blockchains to build a sustainable user base and turn a profit amid fierce competition from larger chains like Ethereum and Solana.
The Kadena (KDA) token once soared close to a $4 billion valuation in November 2021 but as of today, sits at $30.9 million, CoinGecko data shows.
Kadena said it would retain a small team to handle the wind-down period; however, independent validators will still be able to process transactions and mine blocks on Kadena’s proof-of-work blockchain, it noted.
“The Kadena blockchain is not owned or operated by the company. As a thoroughly decentralized proof-of-work smart-contract blockchain, the network is operated by independent miners, while on-chain smart contracts and protocols are governed independently by their maintainers,” it explained.
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Kadena said it will soon “provide a new binary that ensures uninterrupted operation without our involvement, and will be encouraging all node operators to upgrade as soon as possible.”
The KDA token will also continue, and the Kadena team said it will consult with the community on how it should distribute the 83.7 million KDA tokens scheduled to be released in November 2029.
There are another 566 million KDA tokens to be distributed as mining rewards until 2139, Kadena noted.
