Yuga Labs Proposes Shutting Down ApeCoin DAO for New ApeCo Management Entity

Cointelegraph reports that Yuga Labs CEO Greg Solano has submitted an Ape Improvement Proposal to dissolve the ApeCoin decentralized autonomous organization and replace it with a new management entity called ApeCo. Solano stated the DAO has become dysfunctional and "devolved into sluggish, noisy and often unserious governance theater." The proposal would transfer all DAO assets, including ApeCoin tokens and intellectual property, to the new centralized entity under direct Yuga Labs oversight.

Community Response Reflects Broader DAO Governance Challenges

The proposal has received mixed community feedback, with many supporting the transition away from DAO governance. Community member TheDonDiablo777 expressed enthusiasm, while Apewhale noted "DAO fatigue is real" and welcomed the reset. However, not all members support the change, with some calling it "bad optics" for the company.

This reaction mirrors wider challenges facing DAO governance across the cryptocurrency ecosystem. Investopedia identifies key inefficiencies in DAO operations, stating they "run a major risk of being inefficient" due to time needed to educate voters and coordinate decisions. Cointelegraph notes that DAO governance faces "voter apathy and social barriers" while remaining vulnerable to governance attacks from wealthy stakeholders.

Recent data from Cryptopolitan shows smaller DAOs with inactive voting face increased risk of malicious proposals. Projects like DeXe Protocol hold more than $348 million in treasuries while having only a few hundred active voters.

ApeCoin Price Struggles Amid Ecosystem Developments

ApeCoin continues trading around $0.70, representing a dramatic decline from its all-time high of $39.40 in March 2022. CoinCodex forecasts the token could drop another 25% to $0.568 by July 2025, while technical indicators show mixed signals with the RSI at 55.87.

The price struggles come despite major ecosystem developments. ApeChain, the Layer 3 blockchain built on Arbitrum, launched in October 2024 with native yield features and cross-chain functionality. CoinDesk reported that ApeCoin doubled in price during the ApeChain launch, though gains proved temporary.

Market analysts at StealthEX maintain cautious outlook for 2025, projecting ApeCoin could reach between $0.85 and $2.89 depending on broader NFT market recovery and regulatory developments.

NFT Market Decline Adds Pressure to Ecosystem

The broader NFT market downturn has created additional challenges for the ApeCoin ecosystem. Bored Ape Yacht Club NFTs, which originally drove ApeCoin adoption, have fallen approximately 90% from peak values. DL News reports BAYC floor prices dropped below 10 ETH for the first time since August 2021.

Despite the price decline, Statista data shows BAYC maintained a market capitalization exceeding $800 million as of December 2024. The collection remains one of the highest-valued profile picture NFT projects worldwide, though trading volumes have decreased substantially from 2021 peaks.

Implications for Decentralized Governance and Future Outlook

The proposed transition from DAO to traditional corporate structure represents a broader trend in cryptocurrency projects moving away from decentralized governance models. Traditional financial institutions watching crypto governance experiments may view this shift as validation of centralized management approaches.

This development reflects wider industry questions about DAO scalability and effectiveness. While decentralized governance promised democratic participation, many projects struggle with low voter engagement and slow decision-making processes. The ApeCoin case study may influence other projects considering similar governance transitions.

For the cryptocurrency market, this proposal highlights ongoing tensions between decentralization ideals and operational efficiency. As institutional adoption increases, projects may face pressure to adopt more traditional governance structures that align with regulatory expectations and operational requirements.

The success or failure of ApeCo could set precedents for how other major cryptocurrency projects balance decentralization with practical management needs. Market participants will likely monitor community voting outcomes and implementation details as indicators of broader governance evolution trends.

Related Reading on DAO Times

For readers interested in understanding the broader ecosystem of DAO management tools, the comprehensive DAO tooling guide provides detailed analysis of platforms and solutions available for decentralized organizations in 2025. The article examines governance frameworks, treasury management systems, and analytics tools that DAOs use to address the operational challenges that Yuga Labs cited in their proposal. This resource offers practical insights into how other organizations navigate the technical and social complexities of decentralized governance.