Yeh...Sad news indeed. But there are two theories behind it..
1) A file called np9660.prx found in the 3.50 FW will enable loading ISO files. The insider info on this news is that Sony is planning to come out with downloadable games.
Seems like Sony has accepted that their firmwares are hackable and themselves will offer games may be by charging the subscribers.
2) Dark-Alex is disappointed the way Sony menaces PS3 Modders. After 3.51 OE-A Firmware he'll stop any further work cos according to him time consumption on this is high. Obviously it is not paying him enough. Either Sony has threatened him against future possible consequences or he himself got aware that there might be no need to hack future firmwares since Sony might be coming out with a downloadable games services.
Who knows what happens in future...Lets wait and watch.
That's what happened, I'm betting on it. I bet Sony were real mad that 3.50 was cracked, the next day they took out a counter with Official Firmware 3.51 that would nullify Lumines glitch.
Soon after, D_A gives up his work.
Either they paid him to give up or threatened him.