Polkadot-based decentralised finance network Acala and its sister chain Karura, which operates on Kusama, are preparing for a permanent shutdown scheduled for February 10, 2027. This plan is subject to approval through two separate governance referendums. The Acala team attributed the decision to persistent challenges, including fragmented liquidity and insufficient DeFi activity across both the Polkadot and Kusama ecosystems.
Governance referendums to decide network future
The future of Acala and Karura rests on the outcome of two governance votes. Closure of Acala is dependent on the passage of Referendum #195, while Karura’s fate will be decided by Referendum #137. If both proposals are accepted, operations across both networks are expected to cease on February 10, 2027.
Acala and Karura were among the earliest projects to secure parachain slots through Polkadot and Kusama auctions, dedicating almost seven years to protocol development and DeFi innovation. However, according to project developers, fragmented liquidity and a lack of depth in user activity across the networks have continued to undermine growth. Both networks were originally designed to offer a suite of decentralised finance services, including exchanges, stablecoins, and liquid staking.
The development team indicated that maintaining independent DeFi ecosystems had become untenable as user bases and capital spread thinly across multiple chains. Governance approval is still required before any shutdown takes effect, and the community will ultimately make the final decision.
Asset withdrawal deadlines approach for users
Users of Acala and Karura have been urged to withdraw external assets such as DOT, KSM, USDT, and USDC before the planned cessation of network operations. The advisory does not apply to native ACA and KAR tokens, which cannot be withdrawn based on the current proposal. The team stressed that users should pay close attention to further withdrawal instructions and referendum results, as assets will not be automatically redeployed elsewhere.
Liquid staking participants must adhere to earlier deadlines, as their positions involve unbonding requirements prior to withdrawal. Requests to unbond LDOT must be made by January 12, 2027, while LKSM unbonding should be completed by February 2, 2027. Users who miss these deadlines may face difficulties accessing their underlying assets. The network has cautioned that relying on post-shutdown recovery to retrieve funds is not guaranteed.
Mini dictionary: Kusama is an experimental blockchain platform and network built as a proving ground for innovations intended for the Polkadot ecosystem, often hosting early-stage projects and parachains before mainnet deployment.
Project developers explained that “fragmented liquidity and insufficient depth across the ecosystems made it difficult to sustain the networks,” reflecting the wider challenges facing DeFi protocols competing for users and capital.
Liquidity data and current DeFi environment
Acala’s planned closure occurs against a backdrop of declining activity on its infrastructure. According to DefiLlama data, the network’s total value locked stood at around $234,000 on November 8, 2026. Its separate liquid staking product retained approximately $1.73 million in value, indicating that some capital remains active in the ecosystem even as broader usage has contracted.
The wider Polkadot ecosystem currently reports a total value locked of about $84.9 million, as shared by the Polkadot Ecosystem Observatory. The Hydration project represents approximately $22.8 million of that sum, while Bifrost accounts for around $10.9 million. This data suggests that while liquidity clusters in certain parachains, others, including Acala and Karura, have struggled with diminishing activity.
| Network/Project | Total Value Locked (TVL) | Date |
|---|---|---|
| Acala | $234,000 | Nov 8, 2026 |
| Acala liquid staking | $1.73 million | Nov 8, 2026 |
| Polkadot ecosystem | $84.9 million | Nov 9, 2026 |
| Hydration | $22.8 million | Nov 9, 2026 |
| Bifrost | $10.9 million | Nov 9, 2026 |
Despite the closure of two prominent parachain projects, the Polkadot relay chain will remain operational. The winding down of Acala and Karura does not signal a network-wide shutdown, but it does highlight ongoing pressures in decentralised finance ecosystems.
On November 9, DOT traded at approximately $0.88, with a reported market capitalisation near $1.51 billion and a weekly price decline of about 5%. These figures are consistent with broader cryptocurrency market trends and are not being directly attributed to the shutdown announcement.
The upcoming governance votes will determine whether February 10, 2027, becomes the final day for both networks, and users are being urged to act promptly on asset withdrawals to safeguard their funds.
The resolution of the referendums and the adherence of users to withdrawal timelines will serve as a practical test of decentralised governance’s ability to orchestrate the orderly closure of blockchain networks and to protect participant assets throughout the process.
