Overview
- The development team published the migration proposal in a July 7 governance post that asks the community to vote on moving SCRT off the Cosmos layer‑1 and issuing a new ERC‑20 SCRT on Arbitrum.
- SCRT Labs frames the plan as a security response after a June 2026 Axelar‑Secret IBC bridge exploit that drained about $4.7 million and as a defense against tools that make old integration code easier to probe.
- If approved, a one‑time snapshot on Sept. 1, 2026 will qualify only native SCRT and SCRT staked in self‑custody for conversion while excluding bridged SCRT, sSCRT, contract‑held tokens, and IBC assets.
- The proposal would cut staking inflation from 9% to 5%, keep SCRT as the governance token, and end formal maintenance of the Cosmos chain while releasing the network source code under a permissive license.
- Markets reacted negatively to the announcement with SCRT falling about 24% in 24 hours and holders must move eligible balances into self custody before the snapshot if they want to participate in a migration that remains subject to a community vote.