The big picture: Jailbreaking has been the only way for iOS users to find a way outside of Apple's walled garden. Cydia has been at the core of the jailbreaking scene from the early days and appears to be headed towards an eventual shutdown.
Dating back to the early times of iOS, installing apps from outside of the app store was quite doable via jailbreaking. Adding Cydia to an iPhone was made easy thanks to the development of one-click utilities by generous developers.
As Apple has closed up many of the exploits used to gain greater access to iOS devices, jailbreakers have had a harder time achieving what once was only a moderate challenge. Cydia has been the alternative app store for jailbroken iOS devices ever since the concept came about.
Fast forward to now, and Cydia founder Jay Freeman has called it quits on accepting in-app purchases. Even though the issue was just a bug with PayPal's token system, Mr. Freeman has decided to just forego accepting payments altogether. Citing a smaller community and less interest, this marks the beginning of the end for those wishing to get the most out of their iOS devices.
A statement made by Freeman on Reddit confirms that he is moving on from Cydia.
The reality is that I wanted to just shut down the Cydia Store entirely before the end of the year, and was considering moving the timetable up after receiving the report (to this weekend); this service loses me money and is not something I have any passion to maintain: it was a critical component of a healthy ecosystem, and for a while it helped fund a small staff of people to maintain the ecosystem, but it came at great cost to my sanity and led lots of people to irrationally hate me due to what amounted to a purposeful misunderstanding of how profit vs. revenue works.
According to Freeman, even shutting down the service would still cost him a sizable amount of money as he plans to keep archived Cydia repositories alive. Terabytes of bandwidth certainly do tend to rack up the bills. Fortunately, Freeman seems willing to continue hosting much of Cydia's content for the short term, but nobody is willing to indefinitely sustain a loss on a project they are no longer interested in maintaining.
At the end of his post, Freeman says that he will make "a more formal post about the arc of Cydia, likely to be published next week."