Sophon, which has raised $70 million in total funding, is shutting down its Layer 2 blockchain and moving to Base to build consumer apps, claiming the infrastructure era of crypto is over.
"The bet is that the value has never been in who runs the rails, but rather always been in the products built on top," Sebastien (Seb), Sophon's semi-anonymous co-founder, told The Block. "Sophon is choosing to go deep on those products rather than maintain infrastructure."
Notably, Sophon spent about $3.4 million per year maintaining its blockchain, Seb said, covering the full stack of chain infrastructure, rollup-as-a-service, data, analytics, and tooling vendors. Sunsetting the chain cuts annual burn by an estimated $3 million, Seb noted, extending runway and freeing capital to go directly into app development.
As part of its new strategy, the role of the Sophon (SOPH) token will also change. Seb said the token's previous role was as the gas token for the Sophon blockchain. As the chain sunsets, the focus shifts to direct value accrual from product revenue.
"The new strategy centres on buyback and burn," Seb said. "Significant portions of revenues generated by Pyre, XP, SophEarn, SophPlay, SophAI will be used to buy back SOPH on the open market and burn it — tying the token directly to the commercial success of a growing portfolio of consumer products. The more the products win, the more value flows back to SOPH holders."
