Correct.... you should now move on.
Removing the scholarship has a negative effect. If you are wanting to keep a player like this as a backup plan, going forward, you'll want to make sure you add recruiting techniques with positive effort on that very same cycle.
For example, on the same cycle that you're withdrawing the scholarship, try offering promised minutes, promised start, and some HV. All together at once. Doing so will often times keep the recruit interested in your school. But to be clear, it's still not 100% certain it works. (I've done this many many times. And it's always worked for me. But depending on the talent of the player, and how powerful/weak your schools prestige, you "can" still get burned)