Another web3 gaming studio has fallen. This time, it's Midnight Society, the team behind the first-person shooter DEADROP—a game that, despite its unique take on the extraction shooter genre, will likely never see the light of day.
On January 30th, Midnight Society officially announced its closure, bringing an abrupt end to a three-year journey. The studio, founded by Dr. Disrespect (Guy Beahm), Robert Bowling, and Quinn Delhoyo, was first set up to redefine multiplayer shooters with a player-driven approach. However, a series of financial setbacks, leadership turmoil, and industry challenges led to its downfall.
Why Midnight Society Shuts Down
1. Financial Struggles
One of the biggest reasons for the studio's closure was its inability to secure extra funding to finish DEADROP. According to former employee Rich Cabrera, the game was about 85% complete, but the studio failed to raise a follow-up round to fund its completion.
Over the past three years, Midnight Society raised over $11 million, which sounds like a lot—but in the world of AAA game development, it was far from enough.
The team attempted multiple alternative funding options, including:
- A community buyout, where fans could help fund the game.
- Expanding NFT sales and token-based fundraising.
- Exploring potential acquisitions.
Sadly, none of these solutions could materialize in time, and the studio was shut down before any deals could be finalized.
2. The Fallout with Dr. Disrespect
For most of the time, Midnight Society was pretty much synonymous with Dr. Disrespect—one of the biggest gaming personalities on the internet. But in June 2024, the studio cut ties with the streamer after allegations surfaced of inappropriate communications with a minor during his time at Twitch.
Dr. Disrespect had been banned from Twitch in 2020 for unspecified reasons, but details only became public in 2024 when a former Twitch employee accused him of explicit conversations with a minor. Midnight Society responded by immediately terminating its relationship with Beahm, stating:
"While these facts are difficult to hear and even more difficult to accept, it is our duty to act with dignity on behalf of all individuals involved, especially the fifty-five developers and families we have employed along with our community of players."
However, Dr. Disrespect continued to deny any wrongdoing, saying:
"I didn't do anything wrong. All this has been probed and settled. Nothing illegal, no wrongdoing was found, and I was paid."
Regardless, the damage was done. With Dr. Disrespect out of the picture, DEADROP lost its most marketable face, and community trust in the project took a hit.
3. Industry Challenges and Competition
Beyond its internal struggles, DEADROP faced tough competition from other extraction shooters. The genre has been growing rapidly, with games like Off the Grid gaining traction. Meanwhile, other web3-based FPS projects, such as Shrapnel, also faced their own difficulties, as seen with the former CEO leaving for Unioverse.
In September 2024, Midnight Society announced major layoffs, signaling that the studio was in trouble. By the time 2025 arrived, the writing was on the wall.
What Happens to DEADROP Now?
Despite being close to launch, DEADROP's future remains uncertain. The final build of the game is now owned by the board and investors, but Cabrera suggests that a buyout or acquisition would be difficult.
The Rise and Fall of DEADROP
How It Started
Midnight Society was founded in December 2021 with the goal of building a community-first multiplayer shooter. It was co-created by:
- Dr. Disrespect (Guy Beahm) – Former Call of Duty map designer and popular game streamer.
- Robert Bowling – Ex-Call of Duty creative strategist.
- Quinn Delhoyo – Former lead designer at Halo developer 343 Industries.
Together, they launched DEADROP in July 2022, initially calling it Project Moon. The game promised a unique "Vertical Extraction Shooter" experience, combining elements of battle royale with a focus on verticality.
The Player-Driven Model
To involve gamers in development, the team introduced "Snapshots"—early playable builds available only to Founders Pass NFT holders. These players, called "Variants", were given exclusive in-game avatars and could provide feedback to shape the game.
While the concept was ambitious, it also meant that the player base was limited to NFT buyers, making it harder to gain widespread popularity.
What's Next for the Team?
With over 55 developers now out of work, Midnight Society has publicly asked other studios to hire their team.
"We are actively seeking other game studios that would be interested in offering employment opportunities to our talented team members. If you know anyone who's hiring, please forward this message to them or DM us for direct intros."
While some members may move on to other game studios, others might form a new independent team. It remains to be seen if DEADROP's makers will try to revive this project elsewhere.
A Cautionary Tale for Web3 Gaming
The downfall of Midnight Society serves as a stark reminder of the challenges facing web3 game development. While blockchain-based games offer new levels of engagement, they are still struggling to find mainstream acceptance.
What's more, game creation is notably expensive, and without continuous funding, even promising projects can collapse before launch.
With DEADROP now in limbo and investors losing money on NFTs and token sales, Midnight Society's closure is yet another example of how volatile web3 gaming can be.
