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ElizaOS fell 19% over 24 hours to an all-time low after Eliza Labs founder Shaw Walters said the token was “dead” and that the Eliza Foundation was winding down. CoinGecko data showed the token trading at $0.000285 at the time of writing after touching a record low of $0.000284 on Thursday with a market capitalization of $2.1 million.The drop came after an announcement from Walters that the foundation was winding down. “The token is dead. Completely,” Walters said, adding that he no longer owned or supported the token. He said the development of the open-source Eliza software would continue without the token or the foundation. The decline represents a stark reversal for one of the AI-agent sector’s former breakout tokens. Before the project rebranded as ElizaOS, the token, then known as AI16Z, reached a peak market capitalization of $2.5 billion in January 2025, according to CoinGecko.ElizaOS’ 24-hour price chart. Source: CoinGeckoFounder blames lawsuit and token cultureWalters said Eliza Labs privately settled with a group of tokenholders represented by Burwick Law by agreeing to give them its remaining treasury and funds.He called the suit “ridiculous” but said the project lacked the capital to continue fighting it. The lawsuit, filed in April, named Eliza Labs, Walters, Sebastian Quinn-Watson and the AI16Z DAO as defendants. It alleged false advertising, deceptive practices, negligent misrepresentation and unjust enrichment.Court records show the named plaintiff’s claims were dismissed with prejudice by stipulation on July 8, while the proposed class’s claims were dismissed without prejudice.Cointelegraph contacted Walters and Burwick Law founder Max Burwick for comment but had not received a response by the time of publication. Related: Not every AI agent needs its own cryptocurrency: CZWalters said there were no more funds for token buybacks and no foundation or future supply intervention to support the token. He also said he would not allow another token to be associated with Eliza while continuing to build its underlying operating system. “I am starting over, since I own the IP, and I am never letting a token come close to Eliza again […] I’m never going to support an Eliza token,” he wrote. ElizaOS is an open-source framework for building and managing AI agents. The project launched in October 2024 as ai16z with an initial goal of raising $75,000 to build an autonomous investor. In January 2025, it rebranded to ElizaOS after Andreessen Horowitz raised concerns about confusion with its a16z brand. The token was also later migrated. Magazine: Do the Coldcard attacks mean all hardware wallets are now insecure?