Crypto· Ethereum

Harmony proposes shutting down layer 1, migrating ONE to Ethereum

Harmony has proposed shutting down its layer-1 blockchain and converting its ONE token to an ERC-20 asset on Ethereum, seven years after launching its mainnet. The plan involves taking a final network snapshot, airdropping equivalent ONE tokens to Ethereum users, and offering validators compensation to cease operations. The proposal arrives weeks after a security exploit resulted in the unauthorized minting of billions of tokens and plans to reverse over 109,000 transactions.

By AI NewsroomPublished about 20 hours agoUpdated about 20 hours ago4 views

Harmony proposes shutting down layer 1, migrating ONE to Ethereum

Why It Matters

This represents a significant shift in blockchain infrastructure strategy, with an established layer-1 network effectively consolidating operations onto Ethereum rather than continuing as an independent chain. The timing following a major security incident suggests that ecosystem vulnerabilities and recovery challenges may be accelerating decisions to migrate to more established platforms.

Key Facts

Network launch: Harmony mainnet launched seven years prior to proposal
Unauthorized tokens minted: Nearly 4 billion ONE tokens, approximately 26% of total supply
Transactions to be discarded: 109,126 regular transactions and 315 staking transactions in planned rollback
Validator compensation pool: $1.372 million set aside for validators ceasing operations by September 10
Governance requirement: 51% stake participation and 66.7% support needed for proposal passage

Harmony has unveiled a proposal to conclude operations as an independent layer-1 blockchain and transition its native ONE token to Ethereum's network. The plan would involve recording all account balances at the network's final block and distributing equivalent ERC-20 ONE tokens to the same addresses on Ethereum through an airdrop mechanism. This migration would encompass wallet balances, staking delegations, validator rewards, and centralized exchange holdings, requiring no additional claims from users to participate.

The proposal outlines a transition process for network validators, who would have several options going forward. Validators could cease node operations entirely, continue participating as governors of the ecosystem, or pivot to joining Harmony's new artificial intelligence video initiative. Those choosing to stop their nodes by September 10 would be eligible for compensation from a dedicated pool of approximately $1.372 million, provided they retain their stakes and agree to serve as governors.

However, the migration would face significant technical limitations. Harmony specified that multisig safes, liquidity pools, and applications running on the blockchain cannot be migrated to Ethereum, requiring users to withdraw from these systems before the September 10 deadline. The proposal has been characterized as non-binding, and Harmony has not yet confirmed whether the shutdown would proceed through the network's formal validator-led governance process, which typically requires seven days of introduction followed by a 14-day voting period.

This initiative follows closely on a substantial security breach in August that compromised network integrity. An attacker successfully minted approximately 4 billion unauthorized ONE tokens, representing roughly one-quarter of the circulating supply. In response, Harmony announced plans to roll back the blockchain to a checkpoint from August 11, a decision that would invalidate over 109,000 regular transactions and 315 staking transactions. Investigators traced most of the forged tokens to specific wallets and service boundaries and initiated coordination with exchanges, bridge operators, and law enforcement agencies.