Amidst the vast and ever-shifting landscape of the digital world, there once stood a project of grand ambition, the Kinto Network, whose governance token has now, alas, lost more than 91% of its value. This melancholic transformation occurred shortly after the team declared they would cease operations on their Ethereum layer-2 blockchain by the end of September. A series of misfortunes, most notably a catastrophic hack and the subsequent failure to secure additional funding, led to this inevitable denouement.
The Kinto Network, a noble endeavor built upon the robust foundation of Arbitrum and anchored by the venerable Ethereum, sought to harmonize the efficiency of centralized exchanges with the unwavering security of decentralization. It even ventured into the realm of tokenized stock trading, offering the likes of Apple and Microsoft to its eager investors. However, despite these lofty aspirations, Kinto found itself ensnared in the relentless web of financial and security woes, ultimately leading to its demise.
1/ 🛑 Kinto is shutting down.
After exploring every avenue to continue, we have decided to conduct an orderly wind-down to safeguard our users and community.
– Users can withdraw assets as usual
– Phoenix lenders will receive approximately 76%
– Morpho Victims can claim up to $1.1k eachFor full details, follow the thread 🧵
– Kinto (@KintoXYZ) September 7, 2025
In the month of July, a widespread industry exploit drained nearly 577 Ether (valued at $1.6 million) from Kinto’s protocol, a vulnerability stemming from the ERC-1967 Proxy standard, a widely adopted piece of OpenZeppelin code. While several projects suffered similar fates, Kinto’s recovery was tragically incomplete. Despite raising $1 million in debt to rejuvenate their “modular exchange,” the deteriorating market conditions thwarted any further fundraising efforts. “Each passing day sees our funds diminish further. Since July, we have operated without salaries,” the team lamented in a Medium post. They concluded that a clean and responsible shutdown was the sole remaining option.
Kinto has pledged to return the remaining assets to lenders, including a substantial $800,000 of Uniswap liquidity. Lenders are anticipated to recover roughly 76% of their loan principal. Additionally, those affected by the hack will be granted a $1,100 goodwill payment per address, with co-founder Ramon Recuero personally contributing over $130,000 to this endeavor.
This marks Recuero’s second venture in the crypto realm to falter, following the closure of Babylon Finance in 2022 after a $3.4 million hack. In the wake of the shutdown announcement, the Kinto token (K) has plummeted 91%, settling at a mere $0.38, with its market capitalization barely exceeding $1 million. Just weeks prior, in mid-August, the token had soared to a peak valuation of $14.5 million.
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2025-09-08 07:01