From the spotlight to the edge: The bubble burst of 8 star VC-backed projects

In the crypto industry, every bull market gives birth to countless "high-profile projects": fervently pursued by leading VCs, listed on major exchanges, and attracting countless retail investors. However, time is the sharpest test. Some projects have seen their prices plummet by 90% or even 99% since their peak, and discussion about them has declined year by year. This article highlights eight projects funded by star VCs and once highly anticipated during the bull market. From ICP to DYM, we will focus on analyzing their financing backgrounds, market capitalization trends, and the underlying reasons behind their declines—is it an unsustainable model? Is the ecosystem slow to launch? Or is it due to strong competitors and insufficient market demand? Internet Computer ($ICP) Once ranked among the top five cryptocurrencies, it has now lost 99.5% of its value. Launched by the Dfinity Foundation, Internet Computer (ICP) is positioned as a decentralized "Internet Computer," aiming to enable smart contracts to natively run various internet services. Development began in 2018, and the project launched in May 2021 at the height of the bull market, entering the top five cryptocurrencies by market capitalization on its first day, attracting significant market attention. ICP is backed by top Silicon Valley venture capital firms, including a16z, Polychain Capital, Multicoin, and CoinFund, raising a total of $187 million. Initially, ICP's price reached hundreds of dollars, peaking at nearly $700. However, it quickly fell after its launch, falling below $20 within two months. As of 2025, ICP had been hovering around $3, a drop of over 99% from its peak. The main reasons for project failure include inflated valuations, a rushed launch, insufficient initial liquidity, and external concerns about project governance and centralization. Furthermore, the ecosystem's development progressed slowly, failing to deliver on its early promise of "reshaping the internet." Fuel Network ($FUEL) The ambition of a modular execution layer has yet to materialize. The Fuel Network is a layer-two solution for Ethereum scaling. Its core goal is to decouple the execution layer from consensus and data availability, improving throughput and reducing costs. The project is backed by institutions including Blockchain Capital, The Spartan Group, and CoinFund, and reportedly has raised at least $80 million in strategic funding. However, the Fuel Network has failed to meet expectations in terms of token performance and ecosystem development. FUEL currently trades at approximately $0.003, with a market capitalization of only tens of millions of dollars, a decline of over 94% from its peak. With Ethereum scaling and the emergence of various Layer 2 and modular chain solutions, it remains questionable whether Fuel's differentiated advantages can be maintained in the long term. Dymension ($DYM) - A New RollApps Architecture Trial, Price Drops Over 97% - Dymension is a project focused on "modular blockchain" infrastructure, featuring an L1 network that allows developers to quickly deploy application-specific blockchains ("RollApps"). Its design decouples the consensus and settlement layers, optimizing scalability and customization by building RollApps within the ecosystem. The project launched in 2022, with the DYM token launching in early 2024. Despite its clear technical positioning and backing from multiple investors, including Big Brain Holdings, Stratos, and Cogitent Ventures, DYM's current price has plummeted by over 97% from its peak. Data shows that its historical high was near $8.50, and its current price is around $0.10. While the project remains operational, its ecosystem development is slow, and community and user engagement has fallen short of expectations. Flow ($FLOW) Once a star NFT chain, now losing attention, Flow is a high-performance public blockchain launched by Dapper Labs, focusing on NFTs and gaming applications. In October 2020, the FLOW token was publicly launched on CoinList. Riding the NFT craze of 2021, the ecosystem flourished. Backed by a strong funding lineup. Dapper Labs received multiple rounds of investment from institutions such as a16z, DCG, and Coatue between 2018 and 2021, raising over $18.5 million in total funding. The price of FLOW reached an all-time high of approximately $42 in April 2021, then continued to decline as the market retreated. By 2025, the price had fallen to $0.28, a drop of over 96% from its peak, and its market capitalization had shrunk significantly. Flow's decline is closely related to the cooling of the NFT market. The ecosystem's reliance on a single hit app lacks sustained growth momentum, and in the long term, it lacks user retention and real demand. Yield Protocol, a fixed-rate protocol supported by Paradigm, closed in 2023. Yield Protocol is an Ethereum-based lending protocol that offers fixed-term, fixed-rate lending and securitized lending products through the issuance of fyTokens. Launched in 2019, the project was considered a pioneer in the DeFi fixed-income space. In June 2021, Yield completed a $10 million Series A funding round led by Paradigm, with participation from other prominent investors including Framework Ventures and CMS Holdings. However, in October 2023, Yield Protocol officially announced the closure of the protocol, and its official website was immediately taken offline. The core reason for the project's failure was insufficient demand for fixed-rate lending, making it difficult to maintain an efficient market. Furthermore, amidst the overall downturn in the DeFi market and increasing regulatory pressure, Yield was unable to develop a sustainable product model and ultimately chose to voluntarily cease operations, becoming one of the few star VC-backed projects to officially close in recent years.

Notional Finance ($NOTE)

Fixed-rate lending protocols are gradually marginalized

Notional Finance is a fixed-rate lending protocol deployed on Ethereum. It supports users to borrow and lend USDC, DAI, ETH, WBTC and other assets for a fixed period, trying to fill the gap in "stable income" products in the DeFi market. In May 2021, Notional completed its Series A funding round, led by Coinbase Ventures, with participation from leading institutions such as Polychain Capital and Pantera Capital, bringing the total raised to over $11 million. By 2025, the NOTE token's market capitalization had dropped to approximately $1.66 million, representing a drop of over 99% from its peak. Daily trading volume was less than 1,000 yuan, and community activity and protocol updates were low. Notional faced similar core challenges to those of Yield Protocol: user acceptance of fixed-rate products in the DeFi market remained limited, lacking sufficient liquidity. Furthermore, its design diverged significantly from mainstream lending protocols, resulting in low user migration interest and ultimately marginalization. DerivaDAO ($DDX) From a Star Derivatives DEX to Marginal Clearing: DerivaDAO is a decentralized perpetual contract exchange project, first proposed in 2020. Positioned as a derivatives platform that combines the operational experience of a CEX with the security of a DEX, the project emphasizes community governance and seeks to replace centralized operations with a DAO. In July 2020, DerivaDAO secured investments from leading VCs including Polychain, Coinbase Ventures, and Dragonfly, raising a total of $2.7 million. Despite its small size, its roster was considered stellar. After its 2021 launch, the price peaked at approximately $15, but quickly declined. By 2025, DDX had been hovering between $0.01 and $0.04, a drop of over 99% from its peak, bringing the project's market capitalization to near zero. Due to delayed product launches and lack of competitive features, coupled with aggressive early mining incentives that resulted in a rapid release of tokens without real trading demand, DerivaDAO faced significant competition from competitors like DYDX, making it difficult for the project to break through. Eclipse ($ES) A new generation of Layer 2 infrastructure is being tested, with a drawdown exceeding 64%. Eclipse is a Layer 2 solution that combines the security of Ethereum with the high performance of Solana. The project plans to launch its mainnet in 2024 and its ES token in July 2025. The project has received investment from renowned venture capital firms including Placeholder, Hack VC, and Polychain Capital, raising approximately $65 million. However, judging by market performance, the ES token's valuation has already experienced a significant pullback. According to CoinGecko data, while ES is still trading, it has plummeted approximately 64% from its peak. The Eclipse ecosystem is still in its early stages, with fierce competition for roll-up or modular chain solutions. With multiple projects vying for the L2 market, the path to market success for these projects has yet to fully emerge. Conclusion: This article is not intended to criticize or stir up sentiment, but rather to provide a sober review of the "pivot examples" of the previous wave of enthusiasm before the next cycle arrives.

They once possessed the most dazzling capital, narratives, and communities—yet still couldn't escape the trajectory of decoupling, collapse, stalling, and marginalization. In a market heavily intertwined with finance and technology, relying solely on financing, token prices, and buzz is far from enough. Is the business model viable? Can users be retained? Is the product continuously advanced? These are the core variables that truly determine a project's fate.

These stories also remind us not to focus solely on venture capital platforms or short-term surges, but also to learn to identify whether long-term structures hold true.

When the tide recedes, what remains is the true value.