Cardano analytics platform TapTools has announced that it is shutting down, providing a major blow to the ADA ecosystem. This comes amid allegations that the network is a ‘Zombie Chain’ with low user activity.
Cardano’s TapTools Announces It Is Winding Down
In an X post, TapTools announced that they are preparing to wind down their operations within the next two weeks. The Cardano platform cited a leadership issue as the reason for this decision, noting that two of its co-founders, the CTO and COO, departed earlier this year. Following that, their backend developer stepped into the role of CTO but has now also departed the firm.
TapTools said the technical knowledge to “responsibly operate” and maintain the platform cannot be replaced overnight, which has prompted this decision to wind down. The analytics platform is notably one of the most prominent projects in the Cardano ecosystem, serving over a million users.
Meanwhile, the platform revealed that the economics of running their operations remain challenging, citing infrastructure, development, and support costs. They added that operating a platform that supports the ecosystem at scale is expensive. This comes as the bear market puts pressure on crypto projects.
The Cardano price recently crashed to a five-year low, further sparking bearish sentiments. ADA is now down over almost 50% year-to-date (YTD) and has dropped out of the top 10 cryptos by market cap, currently at 15th. TapTools’ decision to wind down also comes amid allegations of Cardano being a zombie chain.
DeFiLlama data shows that ADA’s DeFi total value locked has dropped 15% to just above $100 million. The top five protocols on the network have also seen their TVL drop over 10% in the last seven days, signaling a significant drop in network activity.
Cardano Founder Comments On TapTools’ Winding Down
In an X broadcast, Cardano founder Charles Hoskinson admitted there will be a “wave of failures,” with several projects winding down due to current market conditions. He cited his proposal to use treasury funds to help struggling projects, which was voted down. Hoskinson said there doesn’t seem to be any desire within the ADA community to take Cardano projects to the next level, given that his proposal was rejected.
The Cardano founder warned that the second half of the year will likely be tough for the network as more decentralized applications in their DeFi ecosystem fade away. He further remarked that he is not sure what role he can play in resolving this, as he keeps being criticized for being responsible for the collapse of the ADA price. Hoskinson noted that he doesn’t have any special powers within the ecosystem that would allow him to make any unilateral decisions.
At the time of writing, the Cardano price is trading at around $0.16, down over 16% today, according to data from CoinMarketCap.
Featured image from Unsplash, chart from Tradingview.com
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