Proof of Play announced on Aug. 4 that it will cease operations after failing to turn its blockchain gaming vision into a scalable and sustainable business.

The studio said it could not build a product or business model that validated its Web3 gaming thesis at scale.

The company did not disclose a final closure date, the number of employees affected or its remaining financial position. It also did not identify the buyer of mobile game Shiba Story Go or reveal the acquisition terms.

The closure follows earlier efforts to preserve elements of Pirate Nation, Proof of Play’s flagship blockchain game. The studio released the game’s client, smart contracts and artwork through public GitHub repositories rather than leaving all development materials inaccessible.

Proof of Play could not make its Web3 model sustainable

Proof of Play launched with a thesis that blockchain technology could give players lasting ownership and allow games to survive beyond their original developers. Its seed round was led by a16z and Greenoaks. Fortune reported that the company raised $33 million in September 2023.

The studio focused much of that funding and development work on Pirate Nation, a fully onchain role playing game. Proof of Play described the title as both a game and a testing ground for infrastructure intended to make blockchain gaming easier to build and use.

However, the company now says it “couldn’t build a product and sustainable business that proved out this thesis at scale.” The statement confirms a commercial failure but does not provide revenue, expenses, active player numbers or other financial data explaining the decision.

The shutdown follows similar pressure across Web3 gaming. As crypto.news previously reported, Uncharted closed alongside Fishing Frenzy after failing to establish a sustainable crypto gaming business. In related coverage, Yield Guild Games shut YGG Play and cut 35 positions after deciding its publishing model was no longer commercially viable.

Pirate Nation code survives without a live service

Proof of Play released the Pirate Nation Unity client under an MIT licence for code written by the studio. The repository describes the release as archival and confirms that Pirate Nation is no longer operated as a live service.

The release does not provide a ready to run replacement game. Proof of Play removed commercial Unity assets, private software development kits and credentials. The original backend is also unavailable, meaning developers must replace missing components and provide their own infrastructure before building a functioning version.

The separate smart contract repository contains 56 commits and uses an MIT licence. Proof of Play warned that the contracts were developed as references for deployed Pirate Nation systems, rather than as a complete product prepared for immediate reuse.

Artwork has received broader usage rights. The Pirate Nation art repository carries a CC0 licence and includes Founder’s Pirate NFT files, logos, combat cards and voxel game assets. CC0 allows the public to copy, modify and reuse the released material without seeking conventional copyright permission.

Proof of Play also released PopBot, its internal tool for coordinating several artificial intelligence coding agents. The studio said the system was built to help a small team develop a production game and is now available as a reference that developers can modify.

The PIRATE token moves to an independent foundation

Proof of Play said the Pirate Nation Foundation remains independent and “will continue supporting the $PIRATE token.” The foundation’s website remained operational at the time of reporting and continued offering PIRATE staking access.

The studio drew a clear distinction between PIRATE and its internal reward points. Proof of Play said its points will not be redeemable for products, tokens or other compensation. Holders therefore should not treat the points as a claim against the foundation or the closing company.

PIRATE fell following the announcement. CoinMarketCap showed the token trading near $0.00112, down almost 14% over 24 hours. Its reported market value was approximately $803,000, while daily volume stood near $209,000. The limited liquidity means relatively small transactions can produce sharp price movements.

Shiba Story Go will continue under a new owner

Proof of Play said Shiba Story Go was acquired by a third party and “will continue to operate independently.” The studio did not disclose the buyer, purchase price or whether employees and intellectual property transferred with the game.

The game remained listed on Google Play and Apple’s App Store at the time of reporting. Its existing listings still identified Proof of Play as the developer, suggesting that storefront and support details may require updates after the ownership transition.

The next verified updates will likely concern the closure timetable, repository maintenance, the identity of Shiba Story Go’s buyer and the foundation’s plans for PIRATE. Until those details emerge, Proof of Play’s statement leaves its token ecosystem alive but ends the company that developed its central products.