Story Protocol Co-founder Exits amid Low Token Usage
Story Protocol co-founder Jason Zhao has stepped down from his full-time role just six months after the launch of the protocol’s native IP token. Zhao will transition to a strategic advisor position to focus on his new AI venture, Poseidon. The announcement triggered backlash from industry voices, including EthHub co-founder Anthony Sassano and Cinneamhain Ventures partner Adam Cochran, who criticized the industry’s pattern of rewarding hype over substance.
Story Protocol has raised approximately $143 million, valuing the project at $2.25 billion in its latest a16z-led round. Despite significant funding, the network has generated only $26,652 in lifetime chain fees and recorded $23 in daily fees on August 17. Tokenomics allocate 20% of the 1 billion IP supply to core contributors, vesting linearly over 36 months after a six-month cliff.
Recently, Nasdaq-listed Heritage Distilling announced $220 million in PIPE financing to build an IP token treasury, planning to spend $82 million on open-market purchases within 90 days.
Bearish
Jason Zhao’s departure so soon after the IP token launch and the protocol’s minimal chain fees highlight execution risk and weak adoption. Past founder exits in underperforming projects have often led to price declines and sell-offs. In the short term, traders may lose confidence in Story Protocol, pressuring IP token liquidity and price. Long term, without strong usage metrics or active leadership, the protocol faces challenges securing further developer interest or user growth, reinforcing bearish sentiment.