Caroline Bishop
Oct 22, 2025 09:00
Kadena halts operations citing unfavorable market conditions, transitioning to community governance. KDA token experiences a significant drop, trading down 59% following the announcement.
In a surprising turn of events, Kadena, the Layer 1 blockchain known for integrating Bitcoin’s Proof of Work (PoW) mechanism with Directed Acyclic Graph (DAG) principles, announced on October 21st its decision to halt all business operations. This move comes as a response to challenging market conditions, according to Crypto.ro.
The announcement has significantly impacted the Kadena (KDA) token, which saw a sharp decline in value. The KDA token, which was trading at $0.20 on the eve of the announcement, plummeted to $0.08 on October 22nd. This marks a 59% drop, leaving the token with a market cap of approximately $28.8 million.
Kadena’s Business Shutdown Details
In an official communication via X, Kadena attributed its operational cessation to adverse market conditions that hindered its ability to support and promote its decentralized offerings. The company informed its staff about the shutdown, retaining only a minimal team to manage the transition phase. It was also clarified that the Kadena blockchain is not directly owned or operated by the company but by independent miners, with governance of smart contracts and protocols being independently managed.
Transition to Community Governance
Looking forward, Kadena has laid out a roadmap for maintaining operational continuity. This includes the release of a new binary to ensure uninterrupted blockchain operations without Kadena’s direct involvement. Node operators are encouraged to upgrade promptly to the new system to maintain network stability. Despite the company’s exit, the KDA token and its protocol will persist, driven by the community.
According to the project’s latest tokenomics update from August 2023, over 566 million KDA tokens are slated for distribution as mining rewards up until 2139. Additionally, more than 83.7 million KDA are expected to be unlocked by November 2029.
Market Implications and Future Outlook
The abrupt cessation of operations by Kadena has cast a shadow over the token’s future, with the market reacting negatively to the news. However, the shift to community governance might offer a new direction for the blockchain’s sustainability and growth. The community’s response and adaptation to this new governance model will be pivotal in determining the project’s trajectory.
As Kadena transitions, further updates are anticipated to shed light on how the community will shape the blockchain’s future. Stakeholders and investors will closely monitor these developments to gauge the long-term viability of the KDA token and the network.
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