Ethereum L2 Abstract to Shut Down, Close Chain on Dec. 15 as Growth Stalls

Consumer-focused Ethereum layer-2 network Abstract will halt operations and close its chain on Dec. 15, citing stalled growth and a lack of liquidity.

The Block reported on Oct. 6 that Abstract said in a post on X it had decided to stop operating the network because of limited liquidity, a constrained decentralized finance ecosystem and weak institutional adoption.

Abstract said more than 144 applications have been deployed on the network to date. It also said it drew more than 400,000 users through consumer partnerships with brands including Red Bull Racing and Disney. But the company concluded that changes in market conditions since the project launched had made it difficult to sustain a standalone chain focused exclusively on consumer crypto.

“The industry has changed significantly since Abstract was first conceived,” the company said. It added that it had concluded a chain focused solely on consumer crypto was ultimately not sustainable as an independent model. The company also told users they risk losing access to their funds if they do not bridge their assets to another network before the chain shuts down.

Igloo, Abstract’s parent company and the operator of NFT project Pudgy Penguins, has funded the network over the past 18 months. Luca Netz, Igloo’s chief executive officer, said that effort produced losses amounting to tens of millions of dollars. The company now plans to focus those resources on Pudgy Penguins and its token, PENGU.

Igloo raised more than $11 million in a funding round led by Peter Thiel’s Founders Fund in July 2024 and then began developing Abstract. The project aimed to bring mainstream consumers on-chain by tapping Pudgy Penguins’ user base. Abstract launched its mainnet in January 2025.

Netz said the company also chose not to issue an Abstract token or pursue an initial coin offering to recoup the losses. “Even after taking an eight-figure loss, we could have launched a token or moved forward with an ICO,” he said. “But tokens only work when there is something to drive demand, and we did not think it was right to launch a token for the community without that conviction.”

The decision comes less than a week after Paradigm-backed Ethereum layer-2 network Blast announced plans to shut down, also citing costs that exceeded revenue.