Solana-based NFT marketplace Formfunction is set to shut down on March 29 after only 13 months of operation, amid a slump in Solana NFT prices and trading volumes.
The decision to close the platform was reached after much discussion and careful consideration, although the specific reason for the closure was not disclosed.
Formfunction’s head of community and marketing, known as Magellan, revealed that the team would pivot to a new direction, likely outside the crypto and Solana space.
Formfunction announced the closure in a tweet:
The reality is that the drawdown in price and market activity, led the development team to make such a decision.
Since its launch in February 2022, Formfunction managed to conduct $5 million in sales despite a brutal bear market, but after a slowing down in the market, the decision has been made to shut down.
Data from Solana NFT aggregator SolanaFloor shows that the index of blue-chip NFTs on the Solana blockchain experienced a 75% price drawdown in dollar terms since early February 2022.
Additionally, the daily number of Solana NFT buyers has slowed down, with unique buyers currently around 7,000, nearly half the average seen at the beginning of 2022. The price of SOL has also fallen significantly since Formfunction’s launch.
What Next for Solana?
The whole crypto space has gone through a torrid time since the highs of November 2021, none more so than Solana.
As well as this latest shutdown announcement, some notable NFT collections native to Solana have departed. Recently, DeGods and y00ts, announced their migration to Ethereum and Polygon in search of new opportunities and continued growth.
So what next for Solana? While other altcoins experienced significant drops in value, Solana was particularly impacted by the bankruptcies of FTX, Sam Bankman-Fried’s crypto exchange, and his hedge fund Alameda Research, both of which had supported the token.
The connections were beneficial as long as the funding continued. Sam Bankman-Fried, via FTX exchange and Alameda Trading, bolstered Solana by financially backing every major project developed on the platform.
These entities were deeply embedded within Solana’s ecosystem, playing a substantial role in its growth and success. And of course, we all know what happened next.
Solana certainly isn’t dead, but with the slowdown in development and transition away from the platform, it really needs a shot in the arm.