Harmony, once pitched as an Ethereum rival, has proposed shutting down its own blockchain and turning its ONE token into an ERC-20 asset on Ethereum. The developers cited the cost of defending the network against state actors and AI-powered attackers, a striking admission from a project that launched its mainnet in 2019 and raised serious venture money at the 2021 peak.
“The threats posed by state actors and AI agents are too great,” the project wrote on X. “Since our mainnet launch in 2019, our community has been resilient through attacks and changes, but it is time to fully sunset the Harmony network.”
Retiring a blockchain this way is unusual. Failed chains normally decay, losing users and developers until nothing runs on them. Harmony instead published a migration plan, a validator compensation pool and a new business venture to absorb the token’s future emissions.
How the migration works
Under the non-binding proposal, Harmony would take a final network snapshot recording every ONE balance: wallets, staking delegations, validator rewards, smart contracts and centralized exchange holdings. New ERC-20 tokens would then be airdropped to the same addresses on Ethereum, with no claim process for holders. Delegated stakes and unclaimed rewards would go to individual governor vaults.
Harmony said it would publish the Ethereum contract, snapshot calculations and airdrop scripts for public review. Exchange listings would be migrated as well. The token’s total supply and emission rate stay unchanged, but newly issued tokens would fund the new venture rather than chain security.
There is a catch for on-chain users. Multisig safes, liquidity pools and other smart contracts cannot be migrated. Harmony urged anyone with funds in Harmony smart contracts to exit before September 10, the date validators may begin shutting down their nodes.
Why the chain is shutting down
The proposal lands less than four weeks after a serious exploit. On August 12, Harmony confirmed reports that an attacker had minted nearly 4 billion unauthorized ONE tokens, roughly 26 percent of supply, through a flaw in cross-shard receipt verification. Gate News later put the forged amount at more than 3 trillion ONE across six transactions.
An outside account claimed about 2.8 billion forged tokens reached exchanges. Harmony responded with a controversial rollback to an August 11 checkpoint, discarding 109,126 regular transactions and 315 staking transactions. Investigators traced nearly all forged tokens to wallets or service boundaries and worked with exchanges, bridges and law enforcement.
The August incident was the second major breach. In June 2022, the Horizon cross-chain bridge was drained of nearly $100 million, an attack the FBI later attributed to North Korean state-backed groups Lazarus and APT 38. ONE’s price fell about 40 percent after the August exploit and now trades near $0.00073, a fraction of its 2021 highs.
Validators become governors
Harmony set aside $1.372 million, roughly a year of network-wide validator rewards, to compensate node operators who shut down on schedule, retain their stakes and agree to serve as governors in the new model. The pivot target is what the team calls the Remix Economy for AI Video, a subscription service where creators publish prompts and assets that people and AI agents can reuse to generate video clips.
That creates the strangest part of the proposal. ONE was originally issued to reward validators for securing a blockchain. If the chain disappears, future emissions fund an AI video business instead. Token holders inherit an ERC-20 asset with no chain to secure and a revenue model that has nothing to do with consensus.
Harmony described the proposal as explicitly non-binding, with a disclaimer that all plans are subject to change. It has not said whether the shutdown will go through the network’s formal governance process, under which elected validators submit proposals and voting power is weighted by stake. Passage would require 51 percent of total stake weight to participate and 66.7 percent support after a seven-day introduction and a 14-day vote.
A warning for mid-sized chains
The broader point is not about Harmony alone. The team’s stated reason for quitting, that defending a mid-sized layer-1 against state actors and AI agents has become too expensive, is a claim other small chains will have to answer. Security budgets scale with token value, and chains that cannot fund theirs become targets.
Harmony’s history supports the concern. A $100 million bridge theft, then an exploit that forced a rollback erasing more than 109,000 transactions, left little credibility to defend. Rolling back a public chain is close to the nuclear option in blockchain governance, and doing it once already splits the community. The August rollback wiped out ordinary transfers that had nothing to do with the attack, which is exactly the kind of event that pushes remaining users toward exits.
The migration also tests a question the industry has never answered cleanly: what a token is worth when the thing it secures stops existing. ERC-20 ONE will trade, exchanges will list it, and the airdrop is frictionless. But the value case now rests entirely on an AI video subscription service that has no shipped product yet, no published pricing and no committed users.
Timing matters too. Ethereum’s own roadmap has absorbed displaced communities before, from classic chain splits to collapsed bridge ecosystems, and each migration has shown the same pattern: the token survives, the community thins out, and most holders end up passive. Harmony’s version adds a twist, since emissions continue flowing to a venture rather than stopping at the final block.
If the plan proceeds, holders get a frictionless airdrop, exchanges migrate listings, and Ethereum absorbs another displaced community. The precedent, a chain voluntarily voting itself out of existence and handing its emissions to an unrelated venture, is one other struggling projects will study closely.