Harmony has proposed a major restructuring of its blockchain ecosystem that could bring an end to its independent Layer 1 network. Under the proposed plan, Harmony would retire its existing blockchain after taking a final network snapshot and move its native ONE token to Ethereum as an ERC-20 asset.
The proposal represents a significant change for Harmony, which launched its mainnet in 2019 and has operated as an independent blockchain for several years. However, the project says increasing security threats, including risks involving state actors and AI agents, have made a different approach necessary.
Harmony Plans Final Network Snapshot
According to Harmony’s proposal, the network would eventually stop producing blocks after a final snapshot is taken. The snapshot would record ONE balance across wallets, staking delegations, validator rewards, smart contracts, and centralized exchanges.
Following the snapshot, Harmony plans to issue an ERC-20 version of ONE on Ethereum. The project also intends to work with centralized exchanges to move their ONE listings from the current Harmony network to the Ethereum-based token.
Users would not need to manually submit claims to receive the replacement tokens. Harmony says ERC-20 ONE would be distributed to the same addresses identified in the final snapshot.
The proposal also states that the total supply and emission rate of ONE would remain unchanged. Harmony plans to publish the Ethereum token contract, snapshot calculations, and airdrop scripts publicly, allowing the community and independent researchers to review and audit the migration process.
Users Asked to Exit Smart Contracts
While the proposed migration would cover many ONE holdings, not every asset or application could be moved to Ethereum automatically.
Harmony has specifically warned users about smart contracts, multisig safes, liquidity pools, and other on-chain applications. Users have been asked to exit affected smart contracts before September 10 as part of the transition process.
This is an important part of the proposed shutdown because assets held inside certain applications may not be recoverable through the standard token migration process.
The final block date has not yet been announced, and the proposal remains non-binding. It is also unclear whether Harmony will use its existing validator-led governance process to formally approve the shutdown.
Validators Could Receive Compensation
Harmony has also outlined a separate transition plan for validators and delegators.
Eligible node operators can begin shutting down their nodes from September 10. The project has allocated approximately $1.372 million for compensation to eligible validators and delegators who follow the transition requirements.
The compensation is expected to be distributed over four quarters. Harmony says the payments would cover the difference between emission rewards associated with a validator’s final block and the network’s eventual final block.
Validators who participate in the transition could also retain their stakes and continue their involvement with Harmony as governors after the Layer 1 network is retired.
Harmony Eyes an AI Video Initiative
Interestingly, the blockchain shutdown proposal is also connected to a new direction for Harmony involving artificial intelligence and video content.
The project has proposed an AI video “remix economy” in which creators could publish prompts and other assets that users can fork, remix, and transform into new video content with the help of AI agents.
Under the proposed model, operators would be responsible for video generation, distribution, and content moderation. Staking and service uptime could also play a role in determining rewards.
Harmony says it plans to subsidize GPU hardware during the first year and estimates that operators could potentially generate up to $1 million in combined revenue during that period, depending on the proposed staking and uptime requirements.
The project has also discussed a possible $10 monthly subscription model, with promoters potentially receiving a 30% recurring commission from subscriptions they refer.
Shutdown Follows Major ONE Security Incident
Harmony’s proposed move to Ethereum comes only weeks after a serious security incident involving unauthorized ONE creation.
In August, Harmony discovered that a flaw in cross-shard receipt verification allowed valid receipts to be processed more than once. This resulted in the creation of ONE token without a corresponding debit elsewhere in the system.
Harmony’s later investigation identified more than 3 trillion ONE created across six transactions.
The incident forced the project to consider a blockchain rollback. Harmony proposed returning its shards to checkpoints from August 11, before the forged token activity occurred.
The proposed rollback would remove more than 109,000 regular transactions along with hundreds of staking transactions. Harmony’s analysis found that a large majority of the affected regular transactions were automated activity, including transactions associated with decentralized exchange automation.
Harmony Has Faced Previous Security Problems
The latest incident is not Harmony’s first major security challenge.
In December 2023, Harmony disclosed a staking logic vulnerability that resulted in approximately 146.28 million ONE being minted across dozens of delegator addresses.
The project’s most significant security incident occurred in June 2022, when attackers stole close to $100 million from the Horizon cross-chain bridge. The attack became one of the major bridge exploits in the crypto industry and significantly affected confidence in the Harmony ecosystem.
Harmony later explored several compensation options but ultimately decided against dramatically changing ONE’s token economics through a large new token issuance.
What Happens Next?
For now, Harmony’s Ethereum migration remains a proposal rather than a finalized decision. The project still needs to determine how the shutdown will be governed and when exactly the final block will be produced.
If approved, the plan would mark the end of Harmony as an independent Layer 1 blockchain and transform ONE into an Ethereum-based ERC-20 token.
The transition could also represent a complete strategic shift for Harmony, moving away from operating its own blockchain infrastructure and toward an ecosystem focused on Ethereum, AI-powered video creation, and new forms of digital content.
For ONE holders, validators, and applications operating on Harmony, the coming weeks will therefore be critical. Users should pay close attention to official announcements, especially regarding the final snapshot, smart-contract withdrawals, exchange support, and the exact migration procedure.
As the proposal develops, the biggest question will be whether Harmony can execute the transition securely while protecting user balances and maintaining confidence in the ONE ecosystem.
