Game studio pauses development on their game after sinking Kickstarter funds into crypto

A 3D rendered woman stands next to a green dragon-like creator, with her hand shading her eyes looking up into the distance. Behind her is grass and then a tropical beach. The title says "Untamed Isles" and there is a graphic in the bottom right that says "over 420% funded"Untamed Isles artwork (attribution)
Over 3,000 backers put a combined ~NZ$841,000 (~US$535,000) into Untamed Isles, a Pokémon-like MMORPG. Although the developers did eventually plan to add optional crypto elements for players who wanted them, it was not primarily a crypto game.

On August 11, about a year after the Kickstarter launched, the creators posted an update: they would be pausing development and putting the project on hold because they had run out of money. "We leaned into the crypto market and expanded rapidly off the back of the positive interest. When the crash came, we ended up heavily exposed with too short of a runway."

Project backers were not impressed by this announcement, with many asking for refunds—which the developers had promised if the game never launched. However, the game developers wrote that "Due to our cash reserves being empty, we are not in a position to refund our initial backers."

"Really disappointed by this- I put money into funding this game to back a game, not to throw money into the crypto market," wrote one backer. "Gutted and to be honest pretty appalled," wrote another.