Solana’s Cardinal protocol, known for introducing “conditional ownership” in non-fungible tokens (NFTs), has decided to cease its operations. This move comes in response to poor economic conditions, the team behind the project shared via social media.
The Cardinal protocol of Solana successfully secured $4.4 million in funding to enhance the utility of non-fungible tokens (NFTs). The seed funding was co-led by prominent crypto venture firm Protagonist and Solana Ventures.
The funding also saw participation from other entities in the industry, including Animoca Brands, Delphi Digital, CMS Holdings, and Alameda Research.
Dedicated to fostering the growth of non-fungible tokens (NFTs) on the Solana network, Cardinal Labs played a crucial role as an infrastructure provider.
Their goal revolved around empowering NFT use cases by offering diverse protocols and software development kits (SDKs). These valuable resources encompassed various functionalities, including staking, rentals, subscriptions, royalties, and trading.
The team stated:
We’ve done our best to navigate this incredibly difficult macroeconomic environment since we began building 18 months ago, but like for many others, it has been challenging.
Financial Conditions Unchanged Despite Funding Efforts
As per a Solana Cardinal spokesperson, the investment made by Alameda Research was considered to be a relatively small portion of the funding round. They also clarified that this investment did not play a role in the financial difficulties faced by the protocol.
Cardinal also secured an additional $750,000 in pre-seed funding from Neo Ventures in 2021, further bolstering its financial support. Over 18 months, Cardinal successfully raised a remarkable $5.2 million in funding.
This significant investment highlights the confidence placed in Cardinal’s vision and potential. By July 2022, the protocol had also achieved a notable milestone with over 65,000 NFTs staked on their platform.
In addition, Cardinal acknowledged that despite the existence of “some real usage” in their products, the adoption of blockchain technology by various industries worldwide was progressing at a slow pace,
While we’ve seen some real usage of our staking, rentals, and identity products, we continue to feel like they’re stuck in the context of the crypto maximalist community.
Although recognizing the ongoing growth of blockchain adoption, the Cardinal team emphasized the challenges they faced in achieving product-market fit. Additionally, they expressed their team members’ inclination to explore alternatives.
Solana Cardinal’s Closing Schedule
The team has issued an advisory for users to withdraw their assets from the platform manually. This process will be completed within a two-month notice period, which commenced on June 28.
By July 19, the protocol will cease accepting new deposits, halt staking activities, and disable stake pool creation, token manager creation, name linking, and NFT rentals. During this period, users can only initiate withdrawals from the platform, ensuring the secure retrieval of their assets.
If users do not withdraw their assets by the deadline of August 26, Cardinal has implemented a policy where the remaining assets will be forcibly withdrawn to the depositors’ address.
Featured image from CNBC, chart from TradingView.com