NetEase has halted funding for Nagoshi Studio, putting Gang of Dragon’s development and future at risk as the project moves toward an independent path.

Nagoshi Studio could continue development if it pays out for work already completed under NetEase, or seeks new funding to cover the remaining costs.

The funding cut reflects NetEase’s broader shift away from direct game development, with the studio permitted to go independent but required to compensate for assets and branding.

Gang of Dragon was pitched as a darker, more guns-and-vehicles oriented evolution of the Yakuza formula, featuring Don Lee in the lead.

The game was unveiled at The Game Awards and signals a shift toward a heavier, AAA-style experience within SEGA’s crime saga.

Public previews portrayed Gang of Dragon as a daring tonal shift for the franchise, aiming for a distinct take on SEGA’s crime storytelling.

Updates on the situation are being tracked by Filmogaz.com as the story evolves.

As of now, Gang of Dragon has not been officially canceled; Nagoshi is negotiating potential new funding or rights to existing materials.

Nagoshi Studio, founded in 2021 after Toshihiro Nagoshi left Ryu Ga Gotoku Studio and SEGA, announced Gang of Dragon in December 2025 during The Game Awards.

Nagoshi, a co-creator of the Yakuza series, launched Nagoshi Studio with NetEase, drawing attention to the new project.

There is strong public interest, with tens of thousands of Steam wishlists for Gang of Dragon shown by a single teaser, even as publisher backing remains uncertain.

The project reportedly needs roughly 7 billion yen (about $44 million) to complete, a factor driving NetEase’s decision to halt funding.