Harmony has disclosed that the project is proposing to shut down the existing Layer 1 network and mint ONE as an ERC-20 token on Ethereum following a final snapshot. The proposal is currently non-binding, and the final block time has not been announced; however, the team has requested users to exit on-chain smart contracts by September 10.
The migration plan covers wallets, staking, and exchanges.
As proposed, Harmony will record wallet balances, staking delegations, validator rewards, assets within smart contracts, and ONE held by centralized exchanges at the time of the final block generation, and use this data to distribute new tokens on Ethereum.
The project states that users do not need to submit separate claims; wallet addresses recorded in the snapshot will automatically receive ERC-20 ONE tokens, while delegated staking and unclaimed validator rewards will be allocated to their respective governor vaults. The team noted that the total supply and issuance rate of ONE will remain unchanged due to the migration, and the token contract, snapshot calculation method, and airdrop script will be made public for external audit.
However, not all on-chain assets can be migrated. Harmony stated that multisig wallets, liquidity pools, and on-chain applications cannot be directly transferred through this migration, and users are required to exit related contracts by September 10. The project also plans to coordinate with centralized exchanges to switch existing ONE trading pairs to the Ethereum version.
Validators may go offline starting September 10.
Validators will enter a separate transition process. Harmony has set aside a compensation pool of $1.372 million for validators and delegators who shut down their nodes on time, sign the protocol, maintain their staking, and continue to fulfill governance roles.
This compensation will be distributed over four quarters. The project states that eligible node operators will receive the difference in issuance rewards between their last block production and the network’s final block. Harmony also proposes that existing validators may continue as governors after the public chain is shut down, or transition to participate in the team’s new AI video project.
Shifting focus to AI video services
Harmony stated that after the public chain is phased out, the team will shift its focus to the AI video "remix economy." According to the description, a small number of video creators will release prompts and assets, allowing users to branch off and adapt them, with AI agents generating additional video content.
Under this model, operators will be responsible for video generation, distribution, and content moderation, with rewards tied to staking and online uptime. The team states that GPU hardware will be subsidized in the first year, and operators who meet the requirements are expected to generate up to $1 million in total revenue. Future ONE token issuances are also planned to shift toward this new initiative, though specific details will still be subject to input from governance participants.
The shutdown proposal follows the August security incident.
This proposal to shut down followed Harmony’s August security incident. Previously, the project had investigated unauthorized issuance of ONE and briefly considered rolling back several days of on-chain activity. A subsequent post-mortem revealed that the attacker exploited a flaw in cross-shard receipt validation, causing valid receipts to be processed multiple times and generating ONE without corresponding deductions.
Harmony then proposed rolling back two shards to the checkpoint on the evening of August 11. According to the project’s disclosure, the rollback would remove over 109,000 regular transactions and 315 staking transactions. The team also stated that the forged tokens had been sent to independent wallets, exchange accounts, decentralized exchange routers, liquidity pools, bridge contracts, and staking wallets.
Security incidents have occurred multiple times previously.
This is not the first time Harmony has encountered such issues. In December 2023, the project disclosed a vulnerability in its staking logic that led to the erroneous minting of 146.28 million ONE tokens, which was later resolved via an emergency hard fork. Earlier, in June 2022, the Harmony Horizon cross-chain bridge was attacked, resulting in losses of nearly $100 million.
Additional information: Harmony launched its mainnet in 2019. The team stated that security threats from nation-state actors and AI agents are among the key reasons driving their consideration of shutting down the independent public chain.