Key facts
- Secret Network is proposing to migrate from Cosmos to Ethereum layer-2 Arbitrum.
- The move is driven by concerns over AI-assisted exploitation of older code and a perceived thinning of liquidity and builder support on Cosmos.
- The team cited the increasing ease of discovering and exploiting code vulnerabilities due to advanced AI models.
- A recent bridge exploit on Secret Network, resulting in a $4.7 million loss, underscored these security concerns.
- The proposal requires a governance vote, with a planned snapshot of SCRT balances on September 1 for the new ERC-20 token issuance on Arbitrum.
Secret Network, a layer-1 blockchain focused on privacy, is considering a significant shift from its current Cosmos-based infrastructure to Ethereum's layer-2 scaling solution, Arbitrum. The primary driver for this proposed migration, according to the Secret team, is the escalating security risk posed by artificial intelligence, which is making it easier to exploit vulnerabilities in older, less-maintained code.
The team stated that the "security risk is the part we take most seriously," highlighting how AI advancements are lowering the cost and effort required to discover and exploit code weaknesses. This concern was amplified by a recent exploit on the Axelar-Secret IBC bridge, which exposed the dangers of aging code. The Secret team also pointed to a perceived decline in the Cosmos ecosystem's vitality, noting that "liquidity has thinned" and builders have migrated to other platforms, making Arbitrum's established ecosystem, with its "deep liquidity, tooling, wallet and exchange support," a more attractive destination.
This proposal follows a June bridge exploit that led to a loss of $4.7 million in bridged assets, though Secret's native token, SCRT, was unaffected. The team plans to conduct a one-time snapshot of SCRT balances on September 1 to facilitate the issuance of a new ERC-20 SCRT contract on Arbitrum. The total value locked in the Cosmos ecosystem has fallen significantly to around $2 billion, a stark contrast to Arbitrum's $17.4 billion in total value secured. Secret Network itself has a much smaller total value locked (TVL) of $1.3 million on Cosmos. The news of the potential migration led to a sharp decline in the SCRT token's price, falling 24% in the past 24 hours. Secret Network is not the first project to leave Cosmos; NilChain, Sei Network, and Noble have also transitioned or announced plans to move to Ethereum-based solutions.