ElizaOS (ELIZAOS), a token that drew attention as an AI agent project, fell to a record low after its founder declared he would stop supporting it. The project will effectively end its cryptocurrency ecosystem and pivot to open-source software development separated from the token.

Cointelegraph reported on Aug. 6 (local time) that Eliza Labs, led by Shaw Walters (쇼 월터스), will wind up operations of the Eliza Foundation and halt support for the token. It plans to continue developing Eliza software without cryptocurrency.

The market reacted immediately. By CoinGecko data, the ElizaOS token fell about 19 percent in 24 hours to $0.000284, hitting an all-time low. At the time of writing, it traded around $0.000285, and its market capitalisation shrank to about $2.1 million.

Walters made clear he intends to end the token ecosystem. He said, "The token is dead. Totally," and added that he no longer holds or supports the token. He said development of the open-source Eliza software itself will continue, separated from the token and the foundation.

ElizaOS was once seen as a leading project in the AI agent boom. It previously operated under the name AI16Z, and by CoinGecko data its market capitalisation surged to as high as $2.5 billion in January 2025. It drew market interest as a next-generation project combining AI and blockchain, but the decision will effectively bring its token-centred model to an end.

A legal dispute with token holders lay behind the foundation wind-down. Walters said Eliza Labs reached a private settlement with a token holder group represented by Burwick Law and agreed to hand over remaining financial assets and funds. He described the lawsuit as "ridiculous" but said the project did not have enough funds left to continue a lengthy legal battle.

The lawsuit was filed in April. Plaintiffs alleged false advertising, deceptive practices, negligent misrepresentation and unjust enrichment against Eliza Labs and Walters, among others. Court records show the named plaintiff’s claims were dismissed on July 8 by agreement of the parties, and class-action-related claims were left in a state allowing refiling.

Means to defend the token price have also effectively disappeared. Walters said there is no longer money to use for token buybacks, the foundation will end, and it will not carry out market intervention such as future supply control.

He also said he will not allow issuance of new tokens linked to Eliza. Walters said, "I hold the intellectual property and will start again from scratch," and stressed, "I will never let tokens come near Eliza again."

ElizaOS is an open-source framework for building and managing AI agents. The project launched in October 2024 under the name ai16z and initially began with a $75,000 fundraising aimed at developing an autonomous investor. It later changed its name to ElizaOS in January 2025 after concerns that it could be confused with the brand of Andreessen Horowitz (a16z), and the token also underwent related work.

The industry views ElizaOS’ future success as depending on whether it can attract developers and users without a token. With the foundation dissolved, buybacks halted and supply intervention ended at the same time, ElizaOS has been put to a test as it moves away from the existing cryptocurrency project model and shifts to a pure software ecosystem.