Acala and Karura submit on-chain referendums, proposing an orderly shutdown on February 10, 2027
The Acala team submitted on-chain governance proposal Referendum #195 on November 9, 2026, proposing an orderly sunset of the Acala network on Polkadot. Its sister chain Karura on Kusama launched Referendum #137 at the same time. If the two referendums pass, the two chains will stop producing blocks on February 10, 2027, ending about seven years of operation.
In a public letter to the community, Acala said the reason was that liquidity depth in the DeFi ecosystems of Polkadot and Kusama has never been sufficient, and has been further fragmented by the multi-parachain structure, creating multiple shallow markets rather than a single deep market. Operating costs have already exceeded revenue, and continuing to maintain the chains is not sustainable. The team said that proactively shutting down while bridging and XCM routing remain available would allow users to exit more safely.
According to the proposal schedule, users need to withdraw external assets on their own before February 10, 2027, including DOT, KSM, and USDT, USDC and others transferred in through cross-chain bridges. Liquid staking products have earlier deadlines: LDOT tied to validators needs to begin unlocking before December 16, 2026; ordinary LDOT needs to apply for unstaking before January 12, 2027; LKSM needs to complete unstaking before February 2, 2027. The native tokens ACA and KAR cannot be withdrawn cross-chain and will remain permanently on their respective chains.
The team pledged to continue operating collators and RPC nodes and to hold valid coretime before the deadline to ensure the exit channels remain open. After the deadline, it will make every effort to return any remaining external assets to the corresponding Polkadot or Kusama Asset Hub addresses, but does not guarantee full repayment; external assets in the treasury are planned to be donated to the corresponding relay chain treasury. The referendums are still ongoing and are signal votes that grant the team execution authorization, while the final steps still require follow-up governance procedures; whether they will be carried out depends on the will of the holders.
Original source:
Title: Sunsetting Acala and Karura: A Letter to Our Community Publisher: Acala (@AcalaNetwork) Publication date: 2026-11-09 URL: https://x.com/AcalaNetwork/status/2119724879616610647 Nature of source: official project open letter Verification status: the content of the original post was actually read for this report, verification date 2026-11-11; no access restrictions Supporting content: supports Referendum #195 and #137, stopping block production on February 10, 2027, external asset withdrawal deadlines, LDOT/LKSM unstaking deadlines, ACA/KAR being non-withdrawable, best-effort return, and the reason of insufficient liquidity depth
ABAB AI Insight
Acala became one of the first parachain auction winners on Polkadot in 2021, positioning itself as the ecosystem’s DeFi hub, providing an EVM-compatible execution layer, a native DEX, liquid staking (LDOT), and stablecoin products; Karura is its pilot test chain on Kusama. The public letter explicitly acknowledges that the required liquidity depth never materialized, and that the multi-chain structure further diluted users and capital.
This proposal is a signal referendum; even if it passes, follow-up governance steps are still needed to carry out the specific operations, so “if it passes” is a necessary condition rather than a confirmed shutdown. The fact that the native tokens cannot be withdrawn means ACA and KAR holders will face the risk of assets remaining on chains that have been shut down, which stands in sharp contrast to external assets that can be returned on a best-effort basis.
From a broader perspective, among the early Polkadot auction winners, Moonbeam had stopped producing blocks and migrated its token around the middle of 2026, Parallel Finance gradually shut down related products after a security incident, Clover has also left the original parachain path, and Astar is still being maintained. The successive exits of early flagship projects highlight the challenges of capital lock-up, liquidity fragmentation, and external competition to the sustainability of parachains under the auction model. Polkadot has shifted to more flexible models such as Agile Coretime and is advancing architectural upgrades, but the shutdowns of early projects still provide cases for re-examining the difficulty of realizing the multi-chain vision.
ABAB News · Cognition Law
A signal referendum grants authorization, but does not mean the technical shutdown will be automatically executed; follow-up governance procedures are still required.
“Best-effort return” explicitly excludes a full guarantee, and users withdrawing early on their own is the more reliable path.
The fact that native tokens cannot be withdrawn cross-chain creates a mechanical distinction from external assets that can exit; after shutdown, they will remain permanently on-chain.