Less than 90 days into 2026, more than 10 Web3 projects had already announced shutdowns. This was not the usual cycle of collapses driven by rug pulls or public scandals. In many cases, teams posted a notice, wound down services, and left quietly. The list spans blockchain games, lending protocols, derivatives platforms, analytics products, and infrastructure projects, with a shutdown notice appearing on average less than every nine days.
Gaming projects were hit first as revenue failed to cover operating costs
The pressure was most visible in Web3 gaming. On February 26, GENSO Online said it would shut down its game servers, GENSO Marketplace, LAND Viewer, and MV Wallet on April 30. In an AMA, the team said monthly fixed costs were about 10 million yen, including roughly 3.4 million yen for cloud infrastructure and 3 million yen for staffing. Another 1.3 million yen was going to listing maintenance and ROND token buybacks. Monthly revenue from marketplace fees, in-app purchases, and ads was only around 2 million yen. The gap was too large to close.
Ronin-based Pixiland made a similar move on January 15, suspending all Web3 plans indefinitely and shifting back to a pure Web2 offline model. Its token generation event was canceled, and players’ accumulated wPixi points would not become crypto assets. Forgotten Runiverse, another fantasy MMORPG tied to Ronin, announced on January 27 that it would go offline indefinitely. The team described the issue as a mix of financial challenges, but the core problem was the same: it could no longer fund operations.
Lending and derivatives platforms ran into liquidity and execution problems
DeFi also saw a string of exits. ZeroLend, once viewed as a leading Layer 2 lending protocol, had reached more than $250 million in TVL and over 100,000 daily active users. Its expansion across zkSync, Linea, Manta, Zircuit, and XLayer ended up splitting liquidity across weaker environments. Some of those chains lost momentum, oracle support was withdrawn, and the pricing and liquidation backbone of the lending system weakened. On February 17, ZeroLend said it would enter an “honorable wind-down,” cut LTVs across most markets to 0%, disable borrowing, and leave withdrawals open while reallocating assets through contract upgrades.
Polynomial announced an orderly shutdown on February 14. The on-chain derivatives protocol had raised $1.1 million in seed funding, but said execution fell short even as the broader sector expanded. The team canceled its planned first-quarter 2026 TGE and said it would unwind operations while reviewing 27 million transactions collected over time. Step Finance took a sharper blow. On February 24, it said Step Finance, SolanaFloor, and Remora Markets would stop operations immediately after a senior executive’s personal device was compromised, leading to the theft of about $40 million from the treasury. The team later recovered roughly $4.7 million and said it would conduct a partial buyback for STEP holders based on a pre-incident snapshot and begin redemptions for Remora rToken.
Analytics and infrastructure projects showed that funding alone was not enough
Infrastructure and tooling projects were not spared. On February 20, on-chain analytics platform Parsec said it would end all services, issue refunds, and cancel subscriptions. The project had raised a total of $5.25 million from Galaxy Digital, Polychain Capital, Robot Ventures, and Uniswap Ventures, but demand for advanced on-chain dashboards fell as speculative activity cooled. It was also competing against entrenched products such as Dune, Nansen, Arkham, and DeFiLlama.
MilkyWay Protocol announced a permanent shutdown on January 15. The Celestia ecosystem liquid staking project had raised $5 million in April 2024 led by Binance Labs and Polychain, but repeated delays pushed back its V1 release and MILK token launch, leaving it late to the market. With only 10% of liquid staking fees retained by the protocol, the revenue base was too small to support ongoing expenses. The team chose to close and return previously earned USDC on a proportional basis to eligible MILK holders.
ENS made a different kind of decision on February 7, ending development of its dedicated Layer 2 network Namechain. This was not a funding crisis. According to the source material, Ethereum’s Fusaka upgrade raised the mainnet gas limit to 60 million, cutting ENS mainnet registration gas costs by 99% over the past year and bringing average registration fees below $0.05. ENS decided to deploy ENSv2 back on Ethereum mainnet instead. Vitalik Buterin called it “a wise decision.”
The shutdown wave points back to the same structural weaknesses
Across these cases, the pattern is hard to miss. Many projects never built durable cash flow and relied on fundraising or token incentives to buy time. Multi-chain expansion often fragmented liquidity instead of creating scale. Security risk was not limited to smart contracts; Step Finance showed that an operational security failure could wipe out years of work. Capital also appears to be concentrating around sectors with clearer demand, leaving long-tail tokens and projects without real usage under heavier pressure.
A few teams still tried to exit with restraint. Polynomial did not push ahead with a token launch, ZeroLend kept withdrawal paths open and addressed damaged positions, and ENS cut Namechain once it no longer had a clear reason to exist. The list of shutdowns may keep growing through the year, but the reasons are already visible.