- 1 On June 5, Nocturne announced the winding up of the company after all the efforts to survive.
- 2 The company raised funding in 2023, developed new products, shut down those, and took various actions.
- 3 Luke Tchang, the Co-founder of Nocturne, cited the reason for the liquidation as increased regulatory requirements in the space.
Nocturne was a protocol that enabled private accounts on Ethereum. It was aimed at allowing users to deposit or receive funds at private addresses within the Nocturne contracts.
On June 5, Nocturne_xyz posted on its X account regarding the gradual shutting down of the company after shutting down the privacy protocol built earlier last year. The company has made many survival attempts since last year, but none have worked.
Hey all, some tough news. After shutting down the privacy protocol we built earlier last year, we’ve decided to wind down the company.
— Nocturne (@nocturne_xyz) June 5, 2024
The frontend https://t.co/bDN4zxs1fH will remain open for withdrawals until the end of this month. From there we will convert the withdrawal…
Moreover, the crypto community considered that it would achieve its desired success when it received funding of $6 Million in October 2023, led by Bain Capital Crypto, Polychain Capital, and received participation from Robot Ventures, Bankless Ventures, and Hack HackVC.
Angel investors include Vitalik Buterin, Tim Beiko, Anurag Arjun, Ashwin Ramachandran, Nemil Dalal, Calvin Liu, Aaron Henshaw, and Tech Chia.
The funds were raised to fund the deployment and continued development of private accounts on Ethereum.
Shutting Down of Nocturne V1
Just three months after funding, Nocturne announced the shutting down of Nocturne V1. In that conversation, the company stated that they are developing and putting efforts towards a new product in the application.
They faced some foundational challenges in the product and thus decided to focus on the primary things first. At that time, the team realized that the first transition that was required was towards public L2s and AA before privacy. Primary concerns were secondary.
The need for privacy was expected to rise again with the emergence of applications and utilities. They were expecting a new product in the following months that was supposed to cater to users’ immediate needs.
Then, they exceeded a TVL of $500K and a volume of $2 Million in a month. Looking at these numbers, the team planned to create more compelling products for its user base.
On January 23, deposits, swaps, and staking on Nocturne were halted, and users were able to withdraw their funds for the whole year through their app.
Nocturne Announced Liquidation
On June 5, the team finally announced in a painful note that they had decided to wind down the company after shutting down the privacy protocol earlier this year.
The app, which was supposed to remain available for the whole year to support withdrawals, will now only be available until the end of June. They have eased the withdrawal process to support their customers. Additionally, they have shared a self-serve process via GitHub repo and detailed instructions on “how to withdraw funds using the CLI tool.”
The company spokesperson expressed gratitude towards the community, stating, “We appreciate everyone who supported the product and mission over the past year and a half. Thank you for the support, feedback, and energy. We wish everyone well in the future.”
The company’s followers responded with disappointment after hearing the news and praised the company’s good products and actions.
Reasons for the Liquidation
Luke Tchang, the co-founder of Nocturne, took to his LinkedIn and X profile to share his journey in the crypto industry and the reasons for the liquidation of Nocturne.
In the post, he highlighted the reason for the liquidation as the increased regulations in the space and the keen category they were working in. The regulations have been turned completely upside down since they began operations.
So, amid the personal risk and threatening regulations, the team decided to shut down the company. However, the followers suspected a lack of funds after burning out the raised funds and the technical challenges in developing the privacy ecosystem.
Luke Tchang is looking for new leadership roles in mid-stage companies this year.
Disclaimer
The analysis given above is for informational and educational purposes only. You should not take it as financial, investment, or other advice. Investing in or trading crypto assets is risky. Please consider your circumstances and risk profile before making any investment decisions.
