The Crossing, Arkane Studios and Valve's first-person shooter planned to meld singleplayer and multiplayer with "crossplay," is officially on hold, reports Joystiq.

"We ran into an unexpected financial challenge some months ago and we had to put The Crossing on hold," says Arkane Studios CEO and creative director Raphael Colantonio, "Since then, we shifted our efforts to other very good projects."

Developed in conjunction with Valve and built upon its Source engine, The Crossing's unique "crossplay" feature would let players step into the shoes of AI characters in another's singleplayer game. Both PC and Xbox 360 releases were planned.

"I can't comment too much about The Crossing," said Colantonio of the alternate-reality dystopia, "other than saying that we have a really fun demo (really, really fun)."

Still underway at the Dark Messiah of Might & Magic developer Arkane are the "immersive first-person RPG" and iPhone "casual strategy game" revealed by Deus Ex lead designer Harvey Smith at the Games Developers Conference last year.