Can we still Forever? ADA drops to a 5-year low, Cardano founder warns of a wave of ecosystem shutdowns

With the ecosystem platform TapTools announcing its shutdown, Cardano’s founder has issued a warning that, amid a weak market and tightening capital this year, the ecosystem could face a wave of project closures. At present, ADA’s price has fallen to a low not seen in over 5 years.

Once regarded as Ethereum’s strongest rival, the public-chain star is now facing the harshest challenge since its launch. After Cardano (ADA) ecosystem data analytics platform TapTools announced it will stop operations, Cardano founder Charles Hoskinson issued a grave warning: under the double blow of a sluggish cryptocurrency market and limited funding, the Cardano ecosystem could see a “wave of closures” this year.

At the same time, yesterday’s ADA price continued to sink, falling another 13.7% over the past 24 hours. The current trading price is $0.1878, setting a new low in more than 5 years—once again raising doubts about Cardano’s development prospects.

Based on performance over the past year, ADA has already dropped by about 70%; compared with the $3.09 all-time high it reached during the 2021 bull market, the decline is more than 93%.

In a video posted on Tuesday on his personal YouTube channel, Charles Hoskinson said: “This is the brutal reality our ecosystem is facing right now.”

I said earlier this year that many project teams won’t be able to hold on, because the market environment is really too bad. Next, there is bound to be a wave of closures within the ecosystem.

Faced with the predicament before him, Charles Hoskinson is eager to find a solution, but he also admits: “I’m not really sure what role I should play, or what position I should take, in solving this problem.”

He emphasized that he does not have any so-called “privilege” or “superpower” over Cardano. He also earnestly urged the community to stop blaming the setbacks of the ecosystem on him alone, and instead work together to seek “a vision, a strategy, and then solve the problems hand in hand.”

If not, even greater setbacks may be ahead.

Charles Hoskinson pointed out: “Over the past few months, even years, I’ve been outlining the actions we, as an ecosystem, must take to prevent these tragedies from happening.”

He specifically mentioned that he had previously tried to acquire decentralized applications (DApps) within the ecosystem and promote their commercialization to energize the market, but ultimately these efforts met with strong resistance.

Also hindered were proposals to use ADA from the Cardano Foundation’s treasury to support ecosystem development. Not long ago, the community even voted down the plan to hold the annual Cardano Summit.

He lamented: “It seems the community doesn’t have a strong willingness to use treasury funds to help these startups take things to the next level.”

Taking the despondently departing TapTools as an example, the heavy financial pressure brought by continuous development and maintenance was precisely the main reason that the project team decided to stop operations. In a statement posted by the TapTools team on the community platform X, they wrote:

The economic benefits of operating platforms like this are still full of challenges. Infrastructure costs money, development costs money, and customer support costs money too. To operate at large scale a platform that serves the entire ecosystem, the expenses are extremely staggering.

They also acknowledged that, in the current market environment, they can no longer make responsible commitments regarding the project’s development prospects.

Charles Hoskinson asserted that if things don’t improve, more DeFi projects in the ecosystem will fade away and trigger a brutal reshuffling of the industry. He said:

As an ecosystem, we have no reason to fail. We have top-tier technology, and we also have steadfast belief. There are many excellent talents here, but we’re losing them. It’s not Charles Hoskinson pushing them away—it’s the harsh economic reality.

• This article is reprinted with permission from: BlockTalk
• Original title: ADA’s brutal plunge hits a 5-year low! Cardano founder mournfully issues a warning: the ecosystem may trigger a “wave of closures”
• Original author: Block Sister Mel