PIP Labs Sheds Staff as Story Protocol Pivots to AI

PIP Labs, the company behind Story Protocol, has laid off five full-time employees and three contractors as it abandons its original pitch to creatives and bets hard on AI infrastructure instead. The cuts represent roughly 10% of total headcount across all Story-connected entities, the company confirmed — a quiet but telling acknowledgment that the IP-for-humans story isn't the one investors want to hear right now.

PIP Labs Cuts 10% of Staff in Story Protocol Pivot

Story Chief Protocol Officer Andrea Muttoni framed the move as a sharpening of focus. 'PIP Labs is sharpening focus [through] a small workforce adjustment,' she said in a statement, pointing to AI trading data and the emergence of AI agents as the company's new direction. The reductions span the Story Foundation and infrastructure layer Poseidon.

A former employee told reporters the cuts were closer to 15% of the team behind Story Protocol, including people who worked on events. That discrepancy — 10% versus 15% — is the kind of gap that usually means someone is counting differently, not that one number is wrong.

PIP Labs is sharpening focus [through] a small workforce adjustment.

What Is Driving PIP Labs' AI Shift?

Why is Story Protocol moving away from IP licensing for creatives?

The honest answer: the original thesis hit a wall. When Story Protocol debuted in February 2025 alongside its native IP token, the pitch was elegant — programmable licensing that automates royalty payments, cuts out rent-seeking lawyers, and lets creators remix IP freely. That vision is still technically alive. But the market for it has been brutally slow to materialize.

So the company is turning to machines. Muttoni said Story remains focused on IP broadly — media, biotech, whatever — but her emphasis landed squarely on Poseidon, the AI data licensing startup incubated by Story. Poseidon raised $15 million in a seed round also led by Andreessen Horowitz, and gives AI developers access to legally cleared training data. In January 2026, Poseidon introduced a dataset with 33,000 hours of audio across 17 languages — audio being, as Poseidon Chief Scientist Sandeep Chinchali argued on X, a primary interface between humans and AI that remains severely underrepresented in training sets.

Companies including Coinbase are already racing to build crypto wallets for AI agents. Story wants to own the data layer underneath all of it. Whether that's a genuine competitive edge or just a better-sounding narrative than 'IP for creatives' depends on whom you ask.

Story Protocol's IP Token Has Fallen 86% Since Its Peak

Here's the number that makes the pivot make sense. Story Protocol's native IP token hit an all-time high of $14.78 in September 2025, putting its market cap near $3.4 billion. As of now, the token trades around $0.80 — an 86% collapse, according to CoinGecko data.

That September spike also coincided with some early chaos. A Story-based meme coin modeled on Baby Shark creator Pinkfong collapsed after a dispute emerged over IP licensing from the South Korean firm behind the viral YouTube hit. Story publicly apologized on X, clarifying it had no involvement in licensing between IP World — a platform for IP-backed meme coins — and other entities. Messy debut for a network built on cleaning up IP.

PIP Labs raised an $80 million Series B in 2024, led by Andreessen Horowitz, which valued the company at $2 billion. Participants included Walt Disney Imagineering executive Scott Trowbridge and pseudonymous NFT collector Cozomo de' Medici. That capital — and that pedigree — buys runway, but not indefinitely. When your token is down 86% and your primary use case hasn't gone mainstream, you find a new angle. Story found Poseidon.

Is This Crypto's New Layoff Pattern?

The PIP Labs cuts don't exist in a vacuum. Earlier this week, the team behind Ethereum layer-2 network Optimism let go of 20 employees. Last month, Block Inc. — Jack Dorsey's payments company — cut more than 4,000 jobs, over 40% of its workforce, with AI cited as a key factor in the restructuring.

There's a pattern forming: companies that raised big during the bull market are now trimming headcount and attaching the word 'AI' to whatever product survives. That's not automatically cynical — AI agents genuinely need data infrastructure, and legally cleared audio datasets genuinely don't exist at scale. But the timing of these pivots, all happening while token prices bleed out, deserves scrutiny.

Muttoni's framing positions this as offense, not defense. 'Poseidon's recent traction is shaping where Story will double down,' she said. Story's IP infrastructure play for AI might be the right call — if the market gets there before the runway doesn't.