Lens' leading project Phaver has ceased operations, and the crypto market is about to usher in a new wave of shutdowns?

Author: Nianqing, ChainCatcher

Recently, DeFi researcher Ignas tweeted that after communicating with the team, it has been confirmed that the encrypted social application Phaver has ceased to operate. In addition, Phaver will also pay 1 to 2 months of severance fees for employees. Some former team members are developing SocialDAO to seek new uses for SOCIAL tokens.

Phaver token SOCIAL price has fallen 99% since TGE in September 2024, with a price of $0.000168 as of press time, and 68% of the tokens are still unlocked.

In 2023, Phaver was once highly expected in the SocialFi boom. Phaver was once the largest mobile application of the Lens protocol, with more than 800,000 downloads and reached 35,000 DAU at its peak, once accounting for 50% of Lens' traffic and 40% of Farcaster's external application share.

It is obvious that Phaver, who is determined to "break the social barriers of Web 2 and Web 3 through Web 2.5", will also find it difficult to break the continuous growth dilemma of the SocialFi track. The short-term incentive after TGE and the decline of the SocialFi boom, the project party will be unable to continue.

In addition to Phaver, TreasureDAO, Zeng Liming, became the "Web3 Nintendo", recently announced the decision to completely terminate game development and distribution and transform to AI.

Although entertainment applications such as social and gaming carry the crypto industry's expectations for Mass Adoption, other tracks are facing pressure to be falsified except for the use of financial attributes such as stablecoins, DeFi, and RWA. After the last bull market ended, the spring of social, NFT and chain games has not yet arrived. In this long cold winter, the crypto market may soon usher in a new wave of closures.

Phaver 's rise and fall history

Phaver was founded in 2020. The members of the Phaver team are from major manufacturers such as Google, Goldman Sachs, and Alibaba. The founder has rich experience in social application in the Web2 field. Phaver aims to provide Web3 applications that control the social experience through decentralized protocols such as Lens and Farcaster. Phaver has always claimed to be "Web 2.5" and supports Web2 login at the time of launch to simplify the process of users entering Web3. Additionally, it is the only social application that allows cross-publishing and integrates both the Lens Protocol and Farcaster protocols.

In October 2023, Phaver completed a $7 million seed round, with investments from many leading institutions such as Polygon Ventures, Nomad Capital, Symbolic Capital Partners, Foresight Ventures, dao5, f.actor, Superhero Capital, Alphanonce and other leading institutions. The valuation is about $80 million.

In May 2024, Phaver launched the token SOCIAL and launched the first season of airdrop activity, and officially completed TGE in September of the same year. After TGE, there has been little important progress in the official industry.

Until the end of 2024, Phaver officially announced a full transformation into SOCIAL DAO, which is a "AI-first Internet organization", which means that only a few people in the Phaver team will continue to participate in DAO's contribution. In order to reduce costs, DAO's daily operations have introduced AI Agent.

Phaver's mobile app has been discontinued in January this year. Currently, its token SOCIAL is almost the same as Memecoin in addition to its staking function.

A new wave of project closures is coming?

On April 3, the chain game ecosystem TreasureDAO announced the complete termination of game development and game distribution, and tried to gradually transform to AI. Treasure DAO's financial situation is facing restructuring, with operating expenses of up to $8.3 million per year, while the current treasury is only $2.4 million, which was originally expected to last until July this year. DAO has laid off 15 employees, so it decided to terminate the gaming business and Treasure Chain and will assist partners in moving to other chains.

The consensus on social and gaming as the entrance to large-scale adoption of Web3 is collapsed in an all-round way.

With the rise of new concepts such as NFT, Web3 social networking, GameFi, etc., Crypto's revolution in data ownership has gradually been linked to Web3.0, and its belief in cryptocurrencies is becoming increasingly important. But in this round of market, financial use cases such as Bitcoin ETFs, RWAs and stablecoins are still invincible, and other tracks are facing pressure to be falsified. After the last bull market ended, the spring of social, NFT and chain games has not yet arrived. The belief in Web3 is beginning to shake -cryptocurrency is more like a major innovation in the field of fintech than a disruptive upgrade of the Internet.

In this long cold winter, the crypto market may soon usher in a new wave of closures.

****The law of survival in the bear market: Survival is the first

priority****

The dilemma between Phaver and TreasureDAO has triggered a deeper discussion: How can the project survive when the market is cold?

Phaver team members said there are three main reasons why the original social project was stopped:

1. TGE and Airdrop Problems: During TGE, the airdrop portal failed for several hours, causing users to be unable to claim tokens immediately, causing panic (FUD).
2. Excessive CEX listing fees: Pay more than US$1 million for listing on five exchanges including Bybit, KuCoin, Gate, etc., and the resources are exhausted.
3. Lack of operating funds: TGE did not sell tokens to avoid further FUD, but it caused a shortage of funds and could not maintain operations.

Phaver's shutdown also reminds other teams that good fund management capabilities are essential crypto projects and cannot be a shortcoming, otherwise there is a high probability of failure. The Phaver team does pay great attention to product building, but the team ignored economics and token management and did not sell any tokens at the time of release. Phaver founder & CEO Joonatan Lintala previously said in an interview with ChainCatcher : "The rapid growth of Friend.tech is interesting, and we are essentially different from it. We are largely more focused on social aspects than the token economy."

Although Farcaster completed a $150 million Series A financing last year at a $1 billion valuation, it is also facing pressure to go public. The social track has always faced difficulties in short-term incentives and long-term growth. Without killer use cases or incentives, it's hard to attract people to leave traditional social platforms like X or Weibo.

In addition, Phaver also explained as a negative case why the project party wanted to go to the big institute. KOL@Chen JianJason believes that many projects are bleeding from Binance under the pressure of breaking the issue price, and ultimately it is not to sell it for much money. The more important purpose is to avoid returning to zero. After all, as long as you have a shell on Binance, even if the price of the coin falls more than 10 times in the bear market and winter winter, the next bull market is likely to be able to recover and suffocate twice. If you don’t go to the big market, returning to zero means you will really return to zero.

@Ye Su believes that second-tier projects like Phaverr (financing below 10m) spend a lot of money on second-tier projects is accelerating death. The correct way to do this is to spend money on CEX, and to save money to polish the product. Now it is progressing smoothly and the market value has remained at 150m. It is most important to survive the winter.

Garbage time is indeed the best opportunity for BUIDL. But the first priority for players is to survive and stay here.