Recur is an NFT startup renowned for hosting the intellectual property (IP) of many big brands including Nickelodeon and Hello Kitty. Unfortunately, Recur announced on August 18, 2023, that its Web3 platform is shutting down. This decision comes despite a $50 million Series A funding round and a respectable valuation of $333 million.
While announcing the decision, the firm cited “unforeseen challenges and shifts in the business landscape” as the major reasons for its shutdown. The news caused massive waves in the NFT community and raised questions about the stability and future of the NFT market.
The Rise And Fall Of Recur
Launched in 2021, Recur rapidly made its name large in the NFT sector by providing businesses with Web3 “building blocks.” Its platform was used in the creation of in-game assets, digital collectibles, and loyalty programs leveraging NFTs. In July 2021, Recur initiated a “jet-setting NFT experience” with Hello Kitty and Friends. At the time, it noted “unprecedented demand” for most of its TV Packs having profile-picture NFTs of Nickelodeon characters.
Nonetheless, the firm’s ambitions were strengthened a little more than a year later. Over the next several months, Recur’s platform will constantly lose its core features, including its ability to cash out stablecoin balances, withdraw NFTs, and trade collectibles on Recur-hosted marketplaces.
In late 2021, Recur announced a valuation of $333 million after it engaged in a $50 million Series A funding round that was led by Digital, an investment fund that is backed by billionaire hedge fund manager Steve Cohen. Other major names participated in a $5 million seed funding round, including Gemini’s Tyler and Cameron Winklevoss, investor and NFT creator Gary Vaynerchuk, and Ethereum co-founder Joe Lubin.
The Challenges In The NFT Space
The decision to shut down the company has not been an easy one, as noted by the firm on Twitter. The NFT market has experienced lots of fluctuations and shifts that have impacted many platforms, including Nifty’s, a social network that turned into a Web3 creators’ portal, which also confirmed its shutdown.
Today, with heavy hearts, we must share some difficult news.
After much contemplation and consideration, we’ve decided to deprecate the RECUR platform, effective November 16, 2023.
Learn more: https://t.co/5NbiTQSAGo
— RECUR (@RecurForever) August 18, 2023
Recur’s move to wind down its platform shows the challenges that even the well-backed and well-funded firms face in the dynamic NFTs landscape. The firm’s shutdown now raises questions about the sustainability of NFT platforms and the factors that help contribute to their failure or success.
Preserving Digital Collectibles
Despite this shutdown, Recur has plans to guarantee that different digital collectibles will live on. The firm insisted that metadata and media for its NFTs will be migrated to the InterPlanetary File System (IPFS). IPFS is a peer-to-peer file-sharing network powered by Protocol Labs. Other assets will be supported on Filecoin’s network.
The move highlights the benefits of decentralized file-sharing networks in the preservation of digital collectibles and the value that they hold for their owners. It also points out the need for major solutions to maintain the integrity and accessibility of digital assets, even in the face of platform closures.
A Warning Tale For The NFT Sector?
Recur’s shutdown, despite massive investment and big-name backers, works as a cautionary tale for the NFT sector. It highlights the volatility and unpredictability of the market and the need for keen navigation and adaptability.
The eventual decision to move assets to decentralized networks such as IPFS also points to emerging best practices in preserving digital value. As the NFT landscape keeps evolving, the lessons gained from Recur’s journey may help influence future approaches and strategies to avoid similar failures in the industry.
