Gitcoin, an Ethereum-based platform for funding public goods and open-source projects, announced on Friday that it will close its primary software development arm, Gitcoin Labs.
The decision reportedly stems from mounting financial pressures, with co-founder Kevin Owocki stating that achieving profitability for the unit was no longer feasible.
“The financial overhead of Grants Lab has exceeded its runway in the current environment,” Owocki shared via social media, noting the move was made in consultation with Gitcoin’s governance leaders.
Consequently, Grants Lab will not request further funding for the second half of 2025.
The closure will redirect remaining funds to severance packages for affected employees, ensuring support for those impacted.
Despite the news, Gitcoin’s native token, GIT, saw a modest 4% increase in value at the time of the announcement.
Gitcoin has been a cornerstone of the web3 ecosystem, channeling over $60 million to open-source initiatives through its Grants Program, powered by Quadratic Funding—a mechanism co-developed by Ethereum’s Vitalik Buterin.
The platform aligns with the “regen” movement, emphasizing regenerative finance and crypto’s cypherpunk roots.
It has supported projects like Optimism, Polygon, Sei, and Celo, fostering innovation in decentralized systems.
Owocki emphasized that the shutdown does not signal a retreat but a strategic pivot.
He said that Gitcoin will continue with “a leaner team, focusing on the Grants Program and managing its asset portfolio.”
The project claims a resilient community and sufficient funding to operate for years, with the Grants Program secured through approximately 2029.
This restructuring follows a significant overhaul in February 2024, when Gitcoin streamlined its operations by consolidating several decentralized autonomous organizations (DAOs), discontinuing its Layer 2 Public Goods Network, and pursuing profit-driven ventures like yield strategies.
As part of the latest shift, Gitcoin will phase out Grants Stack, a tool for managing funding programs, and the Allo Protocol, its blockchain-based system for democratic capital allocation.
However, the Human Passport digital verification system will continue to be maintained.
Gitcoin reassured its partners and users that the transition will be managed carefully.
“The tech you rely on isn’t disappearing overnight,” the team stated, outlining plans to facilitate technology handoffs and provide ongoing support where possible.
Mathilda DV, lead of the Grants Program, expressed optimism about the future, stating that “the Grants Stack era is closing, but the Grants Program is here to stay.”
Today marks a big shift for us at Gitcoin — and while it’s a tough day, I’m feeling incredibly hopeful about what’s ahead and the opportunities to build on the foundations we've laid and the momentum we've built. 🌱
The Grants Stack era is coming to a close, but the Gitcoin… https://t.co/zlOil8WPCZ
— MathildaDV.Ξth (🍄;🌙) (@mathildawrites) April 25, 2025
She highlighted the opportunity to build on Gitcoin’s established foundation and momentum.
The closure of Gitcoin Labs marks a pivotal moment for the project, reflecting broader challenges in the Ethereum as well as broader crypto funding landscape.
Yet, with a clear focus on its core Grants Program and a commitment to its community, Gitcoin aims to navigate this transition while continuing to support public goods in the decentralized finance / crypto ecosystem.
