Harmony Proposes Layer-1 Blockchain Shutdown and Ethereum Migration
Harmony has put forward a non-binding proposal to decommission its Layer-1 blockchain and migrate its native ONE token to Ethereum. The plan involves recording all ONE balances in a final network block and issuing corresponding ERC-20 tokens on Ethereum. This move follows a recent exploit that led to plans to revert over 109,000 transactions, highlighting the challenges faced by some Layer-1 projects.
Harmony proposes decommissioning its Layer-1 blockchain and migrating the ONE token to Ethereum.
All ONE balances will be recorded in a final snapshot and issued as ERC-20 tokens on Ethereum.
The proposal follows an exploit that led to the minting of 4 billion unauthorized ONE tokens.
Users are advised to exit smart contracts before September 10; validators may begin shutdown on the same date.
Story
Harmony has released a non-binding proposal outlining the decommissioning of its Ethereum-compatible Layer-1 blockchain and the migration of its native ONE token to Ethereum. This proposal comes seven years after the launch of Harmony's mainnet and less than four weeks after an exploit that saw nearly 4 billion unauthorized ONE tokens minted. The plan involves creating a final network snapshot that will record all ONE balances, staking delegations, validator remunerations, and smart contracts. Subsequently, new ERC-20 ONE tokens will be airdropped to the corresponding addresses on Ethereum. Harmony has advised users to exit all smart contracts before September 10, with validators potentially beginning the shutdown on the same date. A pool of $1.372 million is designated to compensate validators who stop on time and agree to continue as governors in Harmony's new AI video initiative. The migration could centralize liquidity and development efforts for the ONE token on Ethereum, but it also reflects the challenges some Layer-1 blockchains face in maintaining security and user confidence after significant incidents.
Issue context
The Liquid Network has paused operations following the withdrawal of approximately 4,000 Bitcoin, valued at $320 million. The actors, identifying themselves as 'white-hat hackers,' have contacted Blockstream, pledging to return most of the funds once a vulnerability is fixed. This incident highlights ongoing security challenges within the crypto ecosystem and the need for robust audits, especially in sidechain implementations. Concurrently, Harmony's proposed migration to Ethereum indicates consolidation trends in the Layer-1 space, while significant token movements on Hyperliquid draw attention to liquidity and investor behavior.
The events in this issue demonstrate that even established projects can face security challenges and undergo strategic realignments. Volatility and the impact of on-chain movements on liquidity remain crucial factors for you to consider in your decisions. Pay attention to the details of migrations and the market's reaction to large token transfers, as these can influence the dynamics of individual assets.
Market pulse
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This story is part of the Biturai Market Brief and is for informational purposes only. No investment advice.