Ethereum-compatible layer-1 network Harmony has proposed sunsetting its blockchain and migrating its native ONE token to Ethereum, seven years after launching its mainnet. The proposal, announced on Sunday, comes weeks after an exploit that forced the network to plan a rollback of over 109,000 transactions.
Harmony’s migration proposal
Under the non-binding proposal, Harmony would take a final network snapshot, issue ERC-20 ONE tokens on Ethereum, and migrate exchange listings. Validators would be offered options to stop their nodes, continue as governors, or join Harmony’s new AI-video initiative. The proposal does not specify when the final block would be produced or whether the shutdown would be submitted to the network’s validator-led governance process.
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Harmony’s published governance rules require elected validators to create proposals, while unelected validators may vote, with voting power based on total stake. Passage requires 51% of total stake weight to participate and 66.7% support after a seven-day introduction and 14-day vote.
Token migration and validator compensation
If approved, all ONE balances would be recorded at the network’s final block, and new ERC-20 tokens would be airdropped to the same addresses on Ethereum. The snapshot would cover wallets, staking delegations, validator rewards, smart contracts, and centralized exchanges, with no claims required. However, Harmony warned that multisig safes, liquidity pools, and onchain applications cannot be migrated, urging users to exit all smart contracts before Sept. 10.
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Validators may begin shutting down on that date, with a $1.372 million pool set aside to compensate those that stop on time, retain their stakes, and agree to serve as governors.
Context: The exploit and rollback
The proposal comes less than four weeks after an exploit created forged ONE tokens, leading Harmony to plan a rollback that would wipe more than 109,000 transactions. This marks a potential shift from repairing the network to ending it as an independent blockchain.
On Aug. 12, Harmony said it was considering a rollback after reports that an attacker had minted nearly 4 billion unauthorized ONE, equivalent to about 26% of the supply. An outside account claimed about 2.8 billion tokens reached exchanges, but Harmony had not confirmed the figures at the time.
On Aug. 17, Harmony said it planned to revert the blockchain to an Aug. 11 checkpoint, discarding 109,126 regular transactions and 315 staking transactions. Investigators had traced nearly all the forged tokens to wallets or service boundaries and were working with exchanges, bridges, and law enforcement.
Why this matters
This proposal represents a significant pivot for Harmony, which launched its mainnet in 2019 and aimed to offer fast, low-cost transactions with cross-chain capabilities. If the sunset proceeds, it would mark one of the more notable network shutdowns in recent years, raising questions about the long-term viability of smaller layer-1 chains and the role of Ethereum as a migration destination.
For ONE holders, the migration could provide a path to liquidity on Ethereum, but it also underscores the risks of relying on emerging blockchain infrastructure. The inability to migrate smart contracts and liquidity pools highlights technical limitations that could affect user funds.
Conclusion
Harmony’s proposal to sunset its layer-1 and migrate ONE to Ethereum is a developing story that could reshape the network’s future. With a Sept. 10 deadline for users to exit smart contracts, the coming weeks will be critical. The final decision rests with validators, and the outcome will be closely watched by the crypto community.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency markets are volatile and uncertain. Readers should conduct their own research before making any investment decisions.
FAQs
Q1: What is Harmony proposing?
Harmony is proposing to sunset its layer-1 blockchain and migrate its native ONE token to Ethereum as an ERC-20 token. The proposal includes a final snapshot, airdrop, and options for validators.
Q2: When will the migration happen?
The proposal is non-binding and does not specify a final block date. However, users are urged to exit all smart contracts before Sept. 10, and validators may begin shutting down that day.
Q3: What caused this proposal?
The proposal follows an Aug. 12 exploit that minted nearly 4 billion unauthorized ONE tokens, leading Harmony to plan a rollback of over 109,000 transactions. This incident appears to have accelerated the decision to end the independent network.
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