Harmony sets Sept. 10 deadline for ONE holders to exit DeFi

Harmony announced that holders of its native token ONE must withdraw any funds placed in smart contracts by September 10. The deadline applies to liquidity pools, multisig vaults and decentralized applications that cannot be automatically migrated to Ethereum.

What the migration covers

Balances captured in the final blockchain snapshot will be eligible for an automatic airdrop of ERC‑20 ONE on Ethereum. Covered balances include:

• Tokens held in personal wallets
• Staking delegations and unclaimed validator rewards
• Balances on centralized exchanges

These balances will be recreated on Ethereum using the same address format, so no claim filing is required.

Why DeFi positions must be withdrawn

Smart contracts cannot be fully reproduced on Ethereum. While the snapshot can record the amount of ONE a contract holds, it cannot replicate contract logic, ownership rules, or associated token states such as liquidity provider tokens, multi‑signature rules, or loan positions. Users must therefore interact with each protocol and withdraw their assets before the deadline.

Impact on exchanges and self‑custody users

Exchange‑held ONE is expected to be included in the snapshot, and Harmony will work with platforms to replace balances with the ERC‑20 version. Individual users must retain control of the private key or recovery phrase for the address that receives the new tokens; moving funds to a different address before the snapshot would change the recipient.

Validator compensation

Harmony allocated $1.372 million to compensate eligible validators and delegators. Payments will be made over four quarterly installments, provided validators shut down their nodes after September 10 and meet the required agreements.

Tax considerations for U.S. holders

U.S. taxpayers may need to retain records of original ONE purchases, withdrawals from DeFi protocols, snapshot balances and receipt of the ERC‑20 tokens. The IRS treats digital assets as property, and reporting obligations remain even if a broker does not issue a Form 1099‑DA.

Background

The deadline follows an August security incident in which a cross‑shard verification flaw allowed attackers to create over 3 trillion unauthorized ONE tokens. Harmony responded with a rollback plan and has not disclosed the exact block number for the final snapshot or the date of the mainnet shutdown.