Event revealed last month that organisers were in emergency talks to save the cultural festival, which was planned to take place on Hackney Marshes during the Olympic Games.
In a statement, the festival said that whilst support from stakeholders and consumers has been "excellent", it was reliant on the working capital from its investor, which "due to unforeseen circumstances, could not be honoured".
Madeline Crouch, creator and founder of Scipmylo, said: "Scipmylo is about diversity, community and the entertainment, events, food and drink that bring us all together. I had hoped that the Scipmylo Festival 2012 would be a unique celebration of all that is great about the East End of London, and ultimately create a legacy for the people and businesses of East London. I remain passionate about the vision and brand, and hope in the future, we will be back."
Crouch confirmed that the Scipmylo brand will continue trading, and said the possibility remains for the festival to run in the future.
Organisers say those who have bought tickets for the event will receive a full refund.
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