Fantasy Closing Notes: SocialFi's Two and a Half Years of Trial and Error, What Have We Learned?

Article by: kipit

Translated by: Luffy, Foresight News

TL;DR

All angel round and seed investors will receive a full refund of principal and interest, with no funds lost or diverted;

Fantasy has been self-sustaining through revenue alone for two and a half years, returning approximately 20 million USD to the community;

The core lesson we've learned over these two and a half years is: if a product primarily considers economic benefits rather than other factors, it will attract speculators first, not users. This principle applies not only to card chain games but is also the fundamental reason most social tokens and early token projects struggle.

The decision to shut down Fantasy was not made impulsively. We spent months exploring all possible directions, talking with trusted partners, seriously considering a transformation, and ultimately reached a consensus: we lack enough conviction to persist. Therefore, we chose to responsibly end everything and let it conclude with dignity.

This article is a retrospective note: what we built, why we failed, and what new insights we gained about social products, cryptocurrencies, and tokens during this process. We are not the first team to experiment in this space, nor will we be the last. If these experiences can help future entrants avoid the pitfalls we encountered, this entrepreneurial journey will have value.

What We Built

Over the past two and a half years, Fantasy has always been financially self-sufficient through its own revenue. Although the project was once backed by Dragonfly with a $5.6 million funding round, the team never used any external investment funds throughout operations. Few projects in the crypto space can achieve this, and we are proud of that.

Key data on community rewards:

Distributed 2,665 ETH (about $8 million) to regular players

Distributed 1,078 ETH (about $3.2 million) to top influencers/creators

Leveraging the Blast ecosystem, a total of $12.2 million worth of ecosystem incentives were distributed to all players and influencers

After adding Blast rewards, 86% of players ultimately turned a profit

Overall, the funds returned to the community far exceeded the revenue generated from the community, which is the most valuable achievement of the project.

We created one of the most popular products in the social crypto space, characterized by high dissemination and strong user engagement. We launched new mechanisms such as: industry mental influence scoring, social graph prediction markets, lightweight free-to-play modes, and more.

We maintained a rapid iteration and efficient product launch pace. Yet, despite this, we still failed to break through growth bottlenecks.

Core Reasons for Fantasy’s Failure

Our failure boils down to one core reason: we tried to build a crypto product on a foundation that was not originally designed for cryptocurrencies.

Collectible card games have a mature commercial logic—Magic: The Gathering, Pokémon, Yu-Gi-Oh! are all globally popular, long-standing top entertainment IPs. Players are passionate about collecting, trading, and battling cards, with a large audience base.

However, all crypto card games tend to end in failure—whether it’s TopShot, Sorare, or us now—this is not accidental but due to structural flaws in the space.

Traditional top-tier card games focus first on gameplay, then on peripheral products. Players buy cards primarily to enjoy battles; the financial premiums attached to cards are a natural byproduct of mature gameplay and a thriving community ecosystem, not the initial motivation for entry.

In contrast, crypto card games invert this logic: cards become financial speculation targets first, and gameplay becomes secondary. The audience attracted is not game enthusiasts but speculators hoping to profit from card hype, with vastly different demands.

Once a project is fully financialized from inception, all subsequent operations are constrained: game mechanics cannot be freely optimized, as any rule change directly affects card prices; launching new gameplay modes is avoided to prevent community redistribution of benefits. Ultimately, the team stops focusing on refining game content and becomes a manager of financial markets—this is the industry trap we fell into.

We recognized this problem early and tried to break free. We introduced arena modes to lower asset holding barriers, built lightweight traffic channels, opened free-to-play access, even cut the NFT asset system, and shifted fully to social prediction market gameplay. Every adjustment aimed to return to the “game-first” principle, but we could not reverse the overall decline.

The retreat of the Blast ecosystem further worsened the situation. At its peak, Blast was extremely popular, with many users flooding into Fantasy seeking rumored large-scale ecosystem airdrops. In the first month after launch, revenue hit a record high, accounting for 70% of the project’s entire lifecycle income.

Starting at a peak, all subsequent operations faced a downward trend. The team no longer steadily planned for long-term growth but could only passively respond to declining traffic and interest.

Financialization Severely Changed User Circles

This industry flaw is common across the crypto space. Social tokens were initially meant to reshape the connection between creators and fans. Today, almost all related attempts have failed, for the same reason: true fans follow creators because they appreciate their work, ideas, and community atmosphere, not solely for profit.

Once token price fluctuations are embedded between fans and beloved content, pure emotional bonds are distorted. The most active community participants often shift from loyal fans to short-term traders.

This is not a minor detail but a core issue constraining the development of the space.

Crypto excels at designing incentive mechanisms and building consensus among participants—this is its core strength. But a widespread misconception is that simply overlaying financial attributes onto traditional internet products, games, or social communities can upgrade the business model.

The reality is the opposite: adding financial features fundamentally changes the product’s nature and often weakens its core value.

Trying to replicate traditional internet ecosystems with crypto products at scale is fundamentally flawed. Financial attributes are always supplementary; they reshape user demographics and initial motivations for participation.

Deep Reflection on the Token Model

This logic applies not only to end products but also to crypto startups themselves.

Our team has never issued a native project token. Even when tempted multiple times, we ultimately chose to abstain. The reason is simple: before reaching substantial development milestones, issuing tokens is irresponsible. Over 95% of tokens launched in the market see their prices decline, yet many still issue tokens to cash in—an act we firmly oppose.

Looking at various token issuance projects in this cycle, I increasingly believe that most token models have serious flaws.

Issuing tokens prematurely—before a product is mature and market demand is stable—is fundamentally wrong. Previously, I thought strict financial regulation was overly harsh; now I understand the core logic: regulation aims to protect ordinary investors and avoid funding unproven startups. The crypto industry skips this risk control step, paying a heavy price.

Without verified product-market fit, rushing to issue tokens only harms the project. After issuance, teams focus on token price movements; users only watch market fluctuations. The entire team loses focus on product development, and the project stalls.

Even high-quality projects with real revenue and steady growth, like Across Protocol, openly admit that token issuance brings more negatives than positives—this is a lesson for the entire industry.

In this cycle, only a few well-performing tokens—like Hyperliquid, Pump, Jupiter—are exceptions. They built mature business systems, achieved stable revenue, and used platform profits to buy back tokens before issuing, demonstrating real strength and confidence.

Decentralized Physical Infrastructure Networks (DePIN) are among the few structural exceptions, but many early DePIN projects were overvalued at launch and now cannot sustain in today’s market. The sector still lacks recognized long-term success cases.

Similar to crypto card games, early token issuance often leads to vicious cycles. Once tokens are live, they tie projects to high market expectations, severely limiting flexibility for experimentation and exploring sustainable growth paths.

Full Refund to Investors

All angel and seed investors in Fantasy will receive a 100% full refund, with the original funds returned in full.

Our confidence in doing this stems from the fact that the project has been self-sustaining from the start, never using external investment funds. The initial investment was based on the hope that the project could grow into a billion-dollar enterprise; now that this goal is unlikely, we lack the conviction to use these funds for uncertain transformation paths.

We deeply value the trust investors placed in us and will not squander it on reckless or unpromising ventures.

To Platform Creators

Sincerely, thank you! When the project’s business model was unproven, you still chose to join and co-build based on your reputation and influence. You collectively earned over $3.2 million USD on the platform. We hope this reward lives up to your initial trust.

To All Community Users

It was every community member that made Fantasy what it once was. All the impressive data and achievements above could not have happened without your strong support. We once strived to create the most fun social game in the crypto space, and for a time, we succeeded. Thank you for your daily companionship, for building decks, participating in competitions.

Regrettably, we did not meet everyone’s expectations in the end. We understand everyone’s disappointment and regret, and accept this outcome calmly.

If anyone still believes that Fantasy harbors a billion-dollar business idea, they are welcome to give it a try. The entire space is open and accessible; we are willing to share all practical experience and lessons learned from pitfalls.

Having faced many insurmountable industry barriers, we hope newcomers won’t repeat our mistakes or try blindly. It’s better to adopt new development strategies, avoid the detours we took, and create better products than ours.

Writing this retrospective is not a formal farewell but a practical reference for future entrepreneurs.

Currently, crypto card games face inherent growth limits; social products emphasizing financial attributes will inevitably attract only speculators, making it hard to build a core fan base; prematurely issuing tokens without real product-market fit will only hinder development.

These are not problems unique to us but common industry pain points. They are not unsolvable—just not to be blindly copied from old models.

We are not the first to experiment, nor will we be the last. The most valuable trait of the crypto industry is its willingness to explore and learn from trial and error. Every attempt has unique value, regardless of success or failure.

Finally, once again, thank you to everyone who trusted and supported us.