The company behind the Kadena blockchain announced Tuesday that it is shutting down, causing the KDA token to plunge even as the decentralized network remains online.
According to an X post, the Kadena organization wrote, “We regret to announce that the Kadena organization is no longer able to continue business operations and will be ceasing all business activity and active maintenance of the Kadena blockchain immediately.”
Before long, traders reacted to the news, with the price of KDA plunging by more than 60% as of this writing, at $0.089. According to data from CoinGecko, that’s down more than 99% from the all-time high price of $27.64 set in 2021.
Kadena organization noted that it was grateful to everybody who had participated in this journey with them. They insisted that market conditions had pushed them out, and they were unable to continue promoting and supporting the adoption of this unique decentralized offering.
KDA token crashes 60% as Kadena shuts down operations
The company emphasized that the Kadena blockchain is neither owned nor operated by it. As a fully decentralized, proof-of-work smart contract network, Kadena is maintained by independent miners, while on-chain protocols and smart contracts are governed separately by their respective developers.
According to the statement, the developers “will shortly 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 network was founded by two former JPMorgan employees, Stuart Popejoy and William Martino, who had worked on the bank’s early blockchain efforts.
They eventually struck out on their own, forming a startup called Kadena after both had worked on various blockchain projects at the financial behemoth, which released its mainnet in January 2020.
Leveraging on a proof-of-work (PoW) consensus mechanism like those of popular cryptocurrencies Bitcoin and Ethereum, Kadena pitched itself as “the blockchain for business”. In 2020, its founders stated with confidence that the blockchain could be larger than Bitcoin and more reliable than Ethereum.
Although the startup maintained a corporate headquarters in New York with employees, the team stated that miners were distributed worldwide, giving the project a truly decentralized nature.
Kadena fails to live up to the hype
In 2022, Kadena established a $100 million grant program for Web3 developers to build projects on its blockchain, joining other prominent crypto projects such as Solana and Ethereum.
Unfortunately, the project did not live up to the hype, and its native coin, KDA, has a significantly smaller 24-hour trading volume than major coins and tokens, recording a modest $48 million, according to CoinGecko.
The token’s figures sharply contrast with those of Bitcoin and Ethereum, which have rolling daily volumes of over $95.6 billion and $42.9 billion, respectively.
In 2024, in a push to regain its market position and mindshare, Kadena’s Annelise Osborn said the company was going on a “hiring spree.” Kadena raised about $15 million in funding over three rounds.
On-chain metrics, such as total value locked (TVL) and KDA volume, reached an all-time high in 2021 and early 2022, with a TVL of $9 million, according to data from March 2022. It was being claimed at that time that the KDA token would have an FDV of $6.5 billion.
KDA showed some renewed interest last December 2024 when the market entered a micro altseason, as that month saw KDA achieve its highest monthly trading volume since Q2 2022.
Earlier this year, Kadena founder and CEO Stuart Popejoy appeared on The Defiant Podcast to discuss the chain’s Leap Grant Program. The initiative included a $50 million incentive program for ecosystem developers and projects. Still, it is unclear whether the $50 million has been distributed.
The organization noted that it would engage with the Kadena community to discuss actions to take regarding locked and unmined tokens.
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