Secret Network Proposes Migration to Arbitrum Over Security Fears

The proposal, unveiled in a July 7 governance post, centers on the inherent risks of maintaining legacy bridge infrastructure. While the recent Axelar-Secret breach did not compromise the network’s core privacy protocol or confidential compute model, the team argues that older codebases have become increasingly easy to target. As automated vulnerability scanning tools grow more sophisticated, the maintainers fear that smaller ecosystems like Cosmos are no longer equipped to defend against modern attack vectors.

Market conditions further complicate the current arrangement. Secret Network’s leadership points to waning momentum within the Cosmos ecosystem, noting a significant liquidity gap between the two chains. Data from L2Beat shows Arbitrum One commanding $17.4 billion in total value secured, dwarfing the $1.32 million in DeFi TVL currently associated with Secret. Should the community approve the shift, the project plans to wind down official support for the Cosmos-based L1 on September 1, concurrently reducing token inflation from 9% to 5%.

Investors have responded with skepticism, pushing the SCRT token down 25% to roughly $0.041. The migration roadmap includes a strict snapshot process: only native and staked SCRT balances will be eligible for the new token, while IBC assets, contract-held tokens, and bridged derivatives will be excluded. The team has committed to releasing its source code under a permissive license, ensuring that even if the original chain continues as a community-run project, the underlying technology remains accessible.