Andreessen Horowitz-Backed Entropy Announces Shutdown

TheNewsCryptoPublicado em 2026-01-26Última atualização em 2026-01-26

Resumo

Decentralized crypto custody startup Entropy, backed by Andreessen Horowitz (a16z), is shutting down and returning remaining capital to investors, according to founder and CEO Tux Pacific. After four years, multiple pivots, and two rounds of layoffs, Pacific announced the decision on January 25. The company had recently shifted to a crypto automation platform but failed to meet venture-scale growth expectations. Entropy raised $25 million in a 2022 seed round led by a16z crypto, with participation from Dragonfly Capital, Coinbase Ventures, and others. Initially offering a decentralized alternative to custody providers like Fireblocks, the startup ultimately could not achieve sustainable growth. Pacific expressed gratitude to investors and indicated a personal shift away from crypto towards pharmaceuticals.

A decentralised crypto custody startup supported by Andreessen Horowitz (a16z), Entropy is terminating and plans to return the rest of the capital to investors, as per the founder and CEO Tux Pacific.

Pacific publicised through writing on X on January 25 that, “I am winding up Entropy, and after four years, various pivots and two rounds of layoffs, I have decided to terminate Entropy and return capital to the investors.”

The termination is followed by a late-stage push last year to reposition the firm around a crypto automation platform, which Pacific referred to as “basically n8n/Zapier/etc. for crypto”, having automated signing through threshold cryptography, safe computation leveraging trusted execution environments, and deep AI amalgamations.

That product direction was still not able to clear a venture-style growth bar. After the first feedback request disclosed that the business model was not venture scale, Pacific said that he was left with the choice to navigate a creative way forward or pivot once more.

The Heartful Gratitude

Entropy first captivated attention in 2022 when it generated $25 million in a seed round headed by a16z crypto, and the participants were Dragonfly Capital, Coinbase Ventures, Robot Ventures, Ethereal Ventures, Variant and Inflection. Before this, the company had so far accumulated $1.95 million in a pre-seed round.

At rollout, Entropy pitched itself as a decentralised alternative to custody providers like Fireblocks and Coinbase, depending on cryptographic approaches such as multi-party computation to allow users to control how funds move, comprising rule-based constraints.

Pacific also showed gratitude towards a16z crypto and Guy Wuollet for aiding in steering the wind-down and called their guidance “invaluable”. Pacific has also mentioned that they plan to step back before deciding what comes after Entropy.

He added that my time in crypto might be coming to a conclusion, as I feel myself drawn mainly into pharmaceuticals, and they want to work on hormone delivery and validate research on new oestradiol drug formulations.

Highlighted Crypto News Today:

Las Vegas Businesses Use Bitcoin as a Mainstream Payment to Avoid High Credit Card Fees

Perguntas relacionadas

QWhat is Entropy and why is it shutting down?

AEntropy is a decentralized crypto custody startup backed by Andreessen Horowitz (a16z). It is shutting down because, after four years, multiple pivots, and two rounds of layoffs, its founder and CEO Tux Pacific decided to terminate the company as its latest product direction failed to meet venture-scale growth expectations.

QWho were the major investors in Entropy's seed funding round?

AEntropy's $25 million seed round in 2022 was led by a16z crypto, with participation from Dragonfly Capital, Coinbase Ventures, Robot Ventures, Ethereal Ventures, Variant, and Inflection.

QWhat was Entropy's final product pivot before shutting down?

AEntropy's final pivot was to reposition itself as a crypto automation platform, described by its CEO as 'basically n8n/Zapier/etc. for crypto', which featured automated signing through threshold cryptography, safe computation using trusted execution environments, and deep AI integrations.

QWhat did Entropy's founder, Tux Pacific, announce about his future plans?

ATux Pacific announced that he plans to step back before deciding his next move and expressed that his time in crypto might be concluding. He stated he is drawn to the pharmaceutical industry and wants to work on hormone delivery and validate research on new oestradiol drug formulations.

QHow did Entropy initially position itself in the market at its launch?

AAt its launch, Entropy positioned itself as a decentralized alternative to custody providers like Fireblocks and Coinbase, relying on cryptographic approaches such as multi-party computation to give users control over fund movements with rule-based constraints.

Leituras Relacionadas

Warsh, Trump's Next 'Scapegoat' at the Federal Reserve?

Kevin Warsh, a nominee for the Federal Reserve chair, faces a challenging confirmation hearing amid political pressure from former President Donald Trump to implement immediate and significant interest rate cuts. Warsh has proposed reforms including reducing the Fed’s communication frequency and shrinking its $6.7 trillion balance sheet. However, market expectations for rate cuts remain limited, creating tension with Trump’s demands. Warsh’s stance has shifted over time, from hawkish during the financial crisis to more dovish recently, citing AI-driven productivity gains. His confirmation is further complicated by Republican Senator Thom Tillis’s threat to block the nomination unless an investigation into current Chair Jerome Powell is dropped. Trump has warned of firing Powell if he doesn’t leave on time. Observers note that Warsh risks becoming a "scapegoat"—either by yielding to political pressure and fueling inflation, or by resisting and facing Trump’s backlash. His ties to Trump’s circle and Wall Street support may aid his nomination, but his ability to balance political demands with the Fed’s credibility remains uncertain. Historical precedents, like Arthur Burns’s compliance with Nixon, highlight the risks of political interference in monetary policy.

marsbitHá 2m

Warsh, Trump's Next 'Scapegoat' at the Federal Reserve?

marsbitHá 2m

Plunging 10% Then Surging: Weekend Crude Oil Market Watch

Following a 10% plunge, oil prices surged over the weekend as geopolitical tensions in the Strait of Hormuz escalated dramatically. The initial market optimism, driven by the strait’s brief reopening on Friday, quickly reversed on Saturday when Iran reinstated restrictions and fired on vessels, halting nearly all traffic. In response, oil contracts rose approximately 4.52%, while S&P futures fell nearly 0.8%. U.S. President Trump alternated between diplomatic gestures—sending an envoy for talks—and threats to destroy Iranian infrastructure if no deal was reached. Iran rejected further negotiations, fearing a U.S. attack before the midweek ceasefire deadline. This triggered another spike in oil, surpassing Saturday’s highs, and further pressured equity markets. Crypto-related stocks underperformed significantly. Market optimism is expected to be punished, and the week ahead hinges on whether Iran maintains its refusal to negotiate.

marsbitHá 11m

Plunging 10% Then Surging: Weekend Crude Oil Market Watch

marsbitHá 11m

6,000 CEOs Admit AI 'Did Nothing', Yet It Was Used to Lay Off 40,000 People in Q1 This Year

A study by the National Bureau of Economic Research (NBER) surveying 6000 executives across four countries reveals that nearly 90% of businesses report AI has had "no measurable impact" on employment or productivity over the past three years. Despite global AI investments exceeding $250 billion in 2024, only 12% of CEOs reported both cost reductions and revenue growth from AI. Contrastingly, in Q1 2026, the industry saw 78,557 tech job cuts, with 47.9% attributed to AI and automation. Critics label this contradiction an "AI version of the Solow Paradox," referencing the visible lack of AI's effect in productivity data amid widespread adoption. While some leaders, like Anthropic’s CEO, predict AI will eliminate half of entry-level white-collar jobs, others accuse firms of "AI washing"—using AI as a pretext for layoffs originally planned due to over-hiring or weak demand. However, companies like IBM and Cognizant are bucking the trend by increasing entry-level hiring and retraining staff to work alongside AI. Economists suggest a "J-curve" effect may be underway, where initial productivity stagnation is followed by significant gains, as was seen with IT in the 1990s. The transition remains challenging, with true productivity improvements expected within 6–12 months.

marsbitHá 12m

6,000 CEOs Admit AI 'Did Nothing', Yet It Was Used to Lay Off 40,000 People in Q1 This Year

marsbitHá 12m

Solana Q1 Report: Revenue Plunges 68% Year-on-Year, Developers Decrease by 30%

Solana Q1 2026 Report: Key Metrics Show Significant Decline Amid Market Reset Solana experienced a substantial downturn in Q1 2026, with key performance indicators reflecting a broader market cooling. Total network revenue (REV) fell to $89.9 million, down 68% year-over-year (YoY) and 1.4% quarter-over-quarter (QoQ). This decline was driven by reduced speculative activity, which had previously fueled the network during the 2024/2025 bull market. Key revenue components saw mixed results: base fees dropped 8.7% QoQ, Jito tips (MEV) fell 19.7%, priority fees rose 23%, and vote fees declined 44.5%. The annualized real yield for stakers was just 0.17%, down 67% YoY. Network GDP, generated by top applications, fell 7% QoQ to $451 million. Pump Fun emerged as a standout, generating $103 million (up 3% QoQ), surpassing Solana's L1 revenue. However, daily active addresses averaged 2.4 million, down 4.8% YoY. Stablecoin supply on Solana reached $15.9 billion, down 2.7% QoQ but up 18% YoY. USDC and USDT remained dominant. DEX volumes averaged $3.2 billion daily, with private DEXs now accounting for 60% of all volume. The network's net dilution rate was 4.38%, while the cost to produce $1 of REV was $8.10, up 93% YoY. The number of new tokens created on launchpads grew 42% QoQ to 3 million, with Pump Fun dominating 85% of this market. Despite the downturn, Solana's core strengths remain: its position as a hub for retail trading apps, potential in perpetual markets, and growing use in stablecoin-based fintech applications, particularly in Latin America. However, developer activity declined 32% YoY, slightly worse than Ethereum's 29% drop. The network must now focus on attracting traditional finance, competing in perpetual markets, and sustaining developer ecosystem growth to drive the next expansion cycle.

marsbitHá 36m

Solana Q1 Report: Revenue Plunges 68% Year-on-Year, Developers Decrease by 30%

marsbitHá 36m

XRP SuperTrend Flips Bullish For First Time Since January – Is A Rally To $1.90 Next?

XRP's SuperTrend indicator has flipped to a bullish signal for the first time since January 17, suggesting a potential reversal after months of persistent downtrend. The shift occurred after XRP closed marginally above the SuperTrend line at $1.40, indicating weakened bearish momentum. Analyst Ali Martinez identifies $1.55 as a critical resistance level; a decisive break above it could trigger a relief rally toward $1.90. However, approximately 60% of circulating supply is held at an average cost of $1.44, creating significant selling pressure in that zone. XRP is currently trading at $1.42, with the SuperTrend now acting as dynamic support.

bitcoinistHá 44m

XRP SuperTrend Flips Bullish For First Time Since January – Is A Rally To $1.90 Next?