• Rally, a social token platform, announced the shutdown of its sidechain blockchain network on January 31.
• The platform cited difficult market conditions and lack of funding as the major obstacles for its closure.
• Rally’s sidechain was expensive to maintain compared to newer layer-1 blockchain tech stacks.
Rally Announces Sidechain Shutdown
Rally, a social token platform, announced on January 31st that it will be shutting down its sidechain blockchain network. This means that users will no longer be able to access non-fungible tokens (NFTs) on the sidechain. The company communicated this message via email to its users and explained that the winding down process would begin immediately.
Challenging Market Conditions
The company acknowledged that 2022 has been a challenging year not only for their platform but also for the entire cryptocurrency sector as well. Despite their efforts in creating a new path for business continuity, they were unable to overcome the negative macroeconomic factors and ongoing challenges which began last year.
The CEO of Rally admitted that funding had become an obstacle for them and was the major reason behind their decision to shut down their sidechain. They developed the sidechain back in 2018 but since then have found it increasingly expensive to maintain when compared with other newer layer-1 blockchain tech stacks which have emerged since then.
NFT Services Unavailable
With the closure of their sidechain, NFT services are no longer supported by Rally and may soon become inaccessible or experience a decline in service availability due to this shutdown.
Crypto Winter Effects
Rally is just one victim among many others of this current crypto winter which has caused various crypto firms to announce bankruptcy protection or layoff massive amounts of employees while regulators continue heightening their oversight over these activities during this time period.