In short
- Eliza Labs founder Shaw Walters says the Eliza token is “useless” and the challenge’s basis is winding down.
- Walters says the challenge’s remaining treasury was used to settle a class-action lawsuit introduced by Burwick Regulation.
- He says Eliza will now not have a local token and can as a substitute give attention to creating the open-source ElizaOS AI agent framework.
Shaw Walters, founding father of Eliza Labs, says the challenge’s native token is completed and the Eliza Basis is shutting down after a class-action settlement exhausted its remaining funds.
In a publish on X Tuesday, Walters stated the challenge settled with a bunch of token holders represented by Burwick Regulation after deciding it lacked the cash to proceed combating the case.
“The token is useless. Fully. The muse is winding down,” Walters wrote. “I’m beginning over, since I personal the IP, and I’m by no means letting a token come near Eliza once more.”
The announcement caps the rise and fall of one in all crypto’s best-known AI agent tasks.
Launched on Solana in October 2024 as ai16z, it was pitched as an AI-run decentralized autonomous group that used the open-source Eliza framework to automate enterprise capital selections. The token surged to a market capitalization of about $2.5 billion in January 2025 earlier than the challenge rebranded to ElizaOS after Andreessen Horowitz objected to its use of the ai16z title.
In April, Burwick Regulation filed a class-action lawsuit in opposition to Eliza Labs within the U.S. District Court docket for the Southern District of New York, alleging false promoting, misleading enterprise practices, negligent misrepresentation, and unjust enrichment.
The criticism alleges Walters and Eliza Labs marketed ai16z because the governance token for an autonomous AI-managed enterprise fund modeled on Andreessen Horowitz when the challenge was truly managed by insiders. It additionally alleges the challenge improperly used the enterprise agency’s branding, forcing a rebrand to ElizaOS, and later expanded the token provide from 1.1 billion to 11 billion throughout a migration that diluted present holders.
Walters stated the settlement consumed the muse’s remaining treasury and out there money.
“Their declare was ridiculous, however we did not have the capital to legally struggle it so we settled on giving them the remainder of what we had,” he wrote.
Walters stated the lawsuit—and the tradition surrounding speculative crypto tokens—satisfied him to desert tokenization.
“I do not personal any tokens. I do not assist any of it,” he wrote. “I like the expertise and I am going to come again at some point when the tradition has grown previous this level.”
Walters additionally denied personally taking advantage of the challenge, and earned solely a modest wage similar to the corporate’s different engineers.
Regardless of abandoning the token, Walters stated growth of ElizaOS will proceed.
“Gonna preserve constructing it doesn’t matter what, each single day, and I’m not gonna cease till we reside in a world the place we every personal our personal knowledge and we don’t should pay to be good,” Walters wrote. “That’s the mission.”
Now, Walters says Eliza’s future will probably be constructed with out a token.
Walters ended the message, declaring, “Eliza is useless. Lengthy reside Eliza.”
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