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The Solana Cardinal protocol is winding down operations due to economic conditions almost a year after raising $4.4 million to increase the utility of non-fungible tokens (NFTs). According to the announcement on Twitter, the withdrawal must be made by August 26th.
Cardinal Labs was an infrastructure provider dedicated to supporting NFT use cases on the Solana network, offering protocols and software development kits (SDKs) for hosting, renting, subscription, royalty, and trading.
Hey Everyone, we have some unfortunate news to share
After a lot of reflection, we decided to begin the process of winding down our protocols. Let’s dive into it ⬇️
— Cardinal (@cardinal_labs) June 28, 2023
In accordance with the closing schedule, part of the operations will be stopped on July 19, including the creation of a staking pool, management of tokens, NFT leases and lease extensions, social media management, and new deposits. Withdrawals must be completed by August 26, when the two-month notice period ends.
“We’ve done our best to navigate this incredibly challenging macro environment since we started building 18 months ago, but like so many others, it hasn’t been easy,” the Cardinal’s team said on Twitter, adding that although NFT-based products have seen some real traction, they remain “stuck in the context of the maximalist cryptocurrency community.”
In July 2022, Cardinal raised $4.4 million in a seed funding round led by cryptocurrency venture capital firm Protagonist and Solana Ventures, as well as Animoca Brands, Delphi Digital, CMS Holdings and Alameda Research, a subsidiary of already-defunct cryptocurrency exchange FTX. Alameda’s investment was “a very small part of the round” without exacerbating the protocol’s financial difficulties, according to a Cardinal spokesperson.
Another $750,000 has been raised from Neo Ventures as pre-funding in 2021. In total, Cardinal’s received $5.2 million in funding over 18 months, with over 65,000 NFTs placed on the protocol as of July 2022.
Despite the difficult times, the NFT market seems to be slowly maturing. According to a recent report from DappsRadar, the NFT market started the year well, with Q1 2023 being the best quarter since Q2 2022 in the markets.