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{"actor":"system:backfill","investigation_id":"b82aa174-a134-4c10-975f-22432698dc36","kind":"publish","page_slug":"polygon-zkevm","published_at":"2026-07-02T12:17:22.861Z","sequence_num":1,"snapshot":{"content_type":"investigation","entity_name":"Polygon zkEVM","sections":[{"content":"Polygon zkEVM originated from the August 2021 acquisition of Hermez Network, an Ethereum zero-knowledge rollup project, for approximately 250 million MATIC tokens — valued at roughly $250 million at the time of the agreement. The deal was structured as the first full token merger in blockchain history, with HEZ token holders swapping into MATIC at a ratio of 3.5 MATIC per 1 HEZ. Hermez was rebranded as Polygon Hermez and later Polygon zkEVM, with the stated ambition of building an all-purpose, Ethereum-equivalent rollup accessible to all developers. The Mainnet Beta launched publicly on March 27, 2023, with Ethereum co-founder Vitalik Buterin symbolically sending the network's first transaction. Polygon Labs positioned the project as its flagship zero-knowledge scaling initiative.","heading":"Project Background and Origins","severity":"low","sources":[{"credibility":1,"name":"Polygon acquires Hermez in $250 million deal — The Block","type":"news_article","url":"https://www.theblock.co/post/114479/polygon-hermez-merger-matic-hez-tokens-ethereum-projects"},{"credibility":1,"name":"Polygon zkEVM Mainnet Beta Goes Live; Ethereum's Buterin Sends First Transaction — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2023/03/27/polygon-zkevm-mainnet-beta-goes-live-ethereums-buterin-to-process-first-transaction"},{"credibility":1,"name":"Polygon Sets March Date for zkEVM Mainnet Beta to Go Live — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2023/02/14/polygon-sets-march-date-for-zkevm-mainnet-beta-to-go-live"}]},{"content":"Polygon zkEVM failed on multiple technical and commercial dimensions between 2023 and 2026. According to Polygon Labs CEO Marc Boiron, the project suffered from three identified failure points: delayed technical execution, lack of product-market fit, and an organizational failure to adapt as the broader ecosystem shifted toward modular rollup designs. A particularly damaging shortfall was the chain's failure to implement EIP-4844 proto-danksharding — commonly known as 'blobs' — which was introduced on Ethereum in March 2024 and dramatically reduced data availability costs for rollups. Blockchain researcher Lorenz Lehmann of GrowThePie publicly reported that Polygon zkEVM had 'quietly discontinued' development and was never upgraded to use blobs, leaving it operating at an annual loss exceeding $1 million while competitors including zkSync, Starknet, and Scroll absorbed market share. The chain's specialized ZK counter architecture also reportedly created friction for DeFi builders, making debugging and smart contract deployment more difficult than on rival networks. Total value locked peaked near $187 million in March 2024, before declining significantly — dropping approximately 80% to around $16 million by mid-2025.","heading":"Technical Failures and Adoption Shortfall","severity":"high","sources":[{"credibility":2,"name":"Polygon's zkEVM Never Adopted Blobs, Now Running at a $1M+ Annual Loss: Researcher Claims — CryptoPotato","type":"news_article","url":"https://cryptopotato.com/polygons-zkevm-never-adopted-blobs-now-running-at-a-1m-annual-loss-researcher-claims/"},{"credibility":2,"name":"Polygon Shuts Down Its Once-Flagship $250M zkEVM on July 1 — Crypto Times","type":"news_article","url":"https://www.cryptotimes.io/2026/07/01/polygon-shuts-down-its-once-flagship-250m-zkevm-on-july-1/"},{"credibility":2,"name":"Polygon Spent $250M on Its zkEVM Pivot — Now It's Abandoned — CCN","type":"news_article","url":"https://www.ccn.com/news/crypto/polygon-spent-250m-zk-pivot-abandoned-project-burning-millions/"}]},{"content":"Polygon Labs announced the sunset of the zkEVM Mainnet Beta sequencer in June 2025, providing approximately 12 months of advance notice. The sequencer was taken offline on July 1, 2026. Polygon's official guidance distinguished between two categories of affected users. For wallet-held assets — tokens held directly in externally owned accounts — Polygon implemented an automatic migration pathway: a balance snapshot was taken at shutdown, and users can claim equivalent assets on Ethereum L1 through a dedicated interface. This claim window remains open until December 31, 2027, after which unclaimed assets are considered abandoned. DeFi-locked funds present a more serious concern. Assets deposited into smart contracts — including liquidity pools, lending positions, yield vaults, and multisignature wallets — cannot be automatically migrated because Polygon does not own or control those applications. Once the sequencer stopped processing transactions on July 1, 2026, all protocols on the network ceased functioning. Users who did not manually withdraw from DeFi positions before the shutdown deadline face the loss of those assets with no recovery mechanism available from Polygon Labs. QuickSwap, a major DEX deployed on zkEVM, publicly warned users two weeks before the deadline that 'funds locked in DeFi protocols' would be lost after the shutdown date.","heading":"Shutdown and DeFi Funds at Risk","severity":"critical","sources":[{"credibility":1,"name":"Polygon zkEVM Mainnet Beta Sunset: Claim Your Funds — Polygon Community Forum (official)","type":"official","url":"https://forum.polygon.technology/t/polygon-zkevm-mainnet-beta-sunset-claim-your-funds/21856"},{"credibility":2,"name":"Polygon zkEVM Sunset Deadline Nears as Users Urged to Withdraw Assets — CryptoNews","type":"news_article","url":"https://cryptonews.net/news/altcoins/33017031/"},{"credibility":3,"name":"QuickSwap sunset warning on X (Twitter)","type":"social_media","url":"https://x.com/QuickswapDEX/status/2066515050932715648"},{"credibility":2,"name":"Polygon zkEVM Fund Recovery Guide Before Mainnet Beta Ends — CoinGabbar","type":"news_article","url":"https://www.coingabbar.com/en/crypto-blogs-details/polygon-zkevm-fund-recovery-guide-before-mainnet-beta-ends"}]},{"content":"In conjunction with the zkEVM sunset announcement in June 2025, Polygon Labs announced a significant leadership restructuring. Sandeep Nailwal, one of Polygon's original co-founders, assumed the role of CEO at the Polygon Foundation to provide what was described as 'clear direction and focused execution.' Marc Boiron remained CEO of Polygon Labs. Polygon's stated strategic direction shifted to two priorities: the Polygon PoS sidechain, being retooled for stablecoin payments and tokenized real-world assets under a 'Gigagas' performance roadmap targeting 100,000 transactions per second, and AggLayer, a trustless cross-chain settlement layer designed to unify liquidity across multiple blockchains. The zero-knowledge research branch was spun off as Polygon ZisK in June 2025, led by Jordi Baylina — one of Hermez's original developers. Baylina and a core team of seven engineers transferred to SilentSig Switzerland GmbH, a company wholly owned by Baylina, to continue ZK virtual machine development independently of Polygon Labs.","heading":"Strategic Pivot and Leadership Changes","severity":"medium","sources":[{"credibility":1,"name":"Polygon's Sandeep Nailwal Takes Over as Foundation CEO Amid Strategic Shakeup — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2025/06/11/polygons-sandeep-nailwal-takes-over-as-foundation-ceo-amid-strategic-shakeup"},{"credibility":2,"name":"Polygon to sunset zkEVM, bets future on cross-chain settlement and stablecoin payments — Cryptopolitan","type":"news_article","url":"https://www.cryptopolitan.com/polygon-to-sunset-zkevm-bets-future-on-cross-chain-settlement-and-stablecoin-payments/"},{"credibility":1,"name":"Polygon co-founder spins off to launch zero-knowledge project Zisk — The Block","type":"news_article","url":"https://www.theblock.co/post/358755/polygon-co-founder-spins-off-to-launch-independent-zero-knowledge-project-zisk"},{"credibility":2,"name":"Polygon Just Let Go of zkEVM, Here's What Replaced It — Blocmates","type":"news_article","url":"https://www.blocmates.com/news-posts/polygon-just-let-go-of-zkevm-here-s-what-replaced-it"}]},{"content":"The total capital consumed by the Polygon zkEVM initiative is difficult to precisely quantify, but the $250 million MATIC acquisition cost for Hermez Network in 2021 represents the most significant documented outlay. This figure is separate from subsequent operational expenditures by Polygon Labs over the 2021–2026 development and maintenance period. The chain was reportedly running at an annual operating loss exceeding $1 million at the time of its shutdown — a figure attributed to costs associated with posting transaction data to Ethereum without the benefit of the EIP-4844 blobs upgrade that competitors had implemented. The TVL trajectory illustrates the failure to achieve commercial traction: from a peak of approximately $187 million in March 2024, TVL fell roughly 80% to around $16 million in mid-2025 before declining further ahead of the shutdown. MATIC token holders absorbed further losses through the ecosystem rebranding to POL, strategic pivots, and the reputational damage associated with abandoning a flagship product. There are no reported regulatory actions, enforcement proceedings, or court filings related to the zkEVM shutdown.","heading":"Capital Destruction and Investor Impact","severity":"high","sources":[{"credibility":2,"name":"Polygon Spent $250M on Its zkEVM Pivot — Now It's Abandoned — CCN","type":"news_article","url":"https://www.ccn.com/news/crypto/polygon-spent-250m-zk-pivot-abandoned-project-burning-millions/"},{"credibility":2,"name":"Polygon zkEVM — DeFi TVL, Fees, and Revenue — DefiLlama","type":"on_chain","url":"https://defillama.com/chain/Polygon%20zkEVM"},{"credibility":2,"name":"Polygon's ZkEVM Faces Closure Amid Ongoing $1M Yearly Losses — Tron Weekly","type":"news_article","url":"https://www.tronweekly.com/polygons-zkevm-faces-ongoing-1m-yearly-losses/"}]},{"content":"As of July 2, 2026 — one day after the shutdown — the Polygon zkEVM sequencer is offline and no new transactions can be processed on the network. The official claim interface at ui.agglayer.dev allows users with wallet-held assets to claim their holdings on Ethereum L1 through the snapshot mechanism, with a deadline of December 31, 2027. DeFi-locked assets have no such recovery pathway provided by Polygon. Individual DeFi protocols may attempt to implement their own asset recovery mechanisms independent of Polygon Labs, though no confirmed examples of successful recovery were identified in public reporting at the time of this investigation. PancakeSwap issued a user notice advising that it was sunsetting support on Polygon zkEVM, recommending users withdraw before the deadline. The Polygon PoS chain and AggLayer continue operating as the active focus of Polygon Labs' development resources.","heading":"Current Status and Recovery Options","severity":"critical","sources":[{"credibility":1,"name":"Polygon zkEVM Mainnet Beta Sunset: Claim Your Funds — Polygon Community Forum (official)","type":"official","url":"https://forum.polygon.technology/t/polygon-zkevm-mainnet-beta-sunset-claim-your-funds/21856"},{"credibility":2,"name":"Action Required: PancakeSwap Sunsetting Support on Polygon zkEVM — PancakeSwap Blog","type":"official","url":"https://blog.pancakeswap.finance/articles/PolygonzkEVMSunset"},{"credibility":2,"name":"Polygon zkEVM Sunset Reminder: Withdraw Assets Before July 1, 2026 — Outposts","type":"news_article","url":"https://outposts.io/article/polygon-zkevm-sunset-reminder-withdraw-assets-before-july-1-0ef46827-b25b-498b-bf7d-f03b03fac95c"}]}],"sources_used":[{"credibility":1,"name":"Polygon acquires Hermez in $250 million deal — The Block","type":"news_article","url":"https://www.theblock.co/post/114479/polygon-hermez-merger-matic-hez-tokens-ethereum-projects"},{"credibility":1,"name":"Polygon Sets March Date for zkEVM Mainnet Beta to Go Live — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2023/02/14/polygon-sets-march-date-for-zkevm-mainnet-beta-to-go-live"},{"credibility":1,"name":"Polygon zkEVM Mainnet Beta Goes Live — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2023/03/27/polygon-zkevm-mainnet-beta-goes-live-ethereums-buterin-to-process-first-transaction"},{"credibility":1,"name":"Polygon's Sandeep Nailwal Takes Over as Foundation CEO Amid Strategic Shakeup — CoinDesk","type":"news_article","url":"https://www.coindesk.com/tech/2025/06/11/polygons-sandeep-nailwal-takes-over-as-foundation-ceo-amid-strategic-shakeup"},{"credibility":1,"name":"Polygon co-founder spins off to launch zero-knowledge project Zisk — The Block","type":"news_article","url":"https://www.theblock.co/post/358755/polygon-co-founder-spins-off-to-launch-independent-zero-knowledge-project-zisk"},{"credibility":1,"name":"Polygon zkEVM Mainnet Beta Sunset: Claim Your Funds — Polygon Community Forum","type":"official","url":"https://forum.polygon.technology/t/polygon-zkevm-mainnet-beta-sunset-claim-your-funds/21856"},{"credibility":2,"name":"Polygon Shuts Down Its Once-Flagship $250M zkEVM on July 1 — Crypto Times","type":"news_article","url":"https://www.cryptotimes.io/2026/07/01/polygon-shuts-down-its-once-flagship-250m-zkevm-on-july-1/"},{"credibility":2,"name":"Polygon Spent $250M on Its zkEVM Pivot — Now It's Abandoned — CCN","type":"news_article","url":"https://www.ccn.com/news/crypto/polygon-spent-250m-zk-pivot-abandoned-project-burning-millions/"},{"credibility":2,"name":"Polygon zkEVM Sunset Deadline Nears as Users Urged to Withdraw Assets Before July 1, 2026 — CryptoNews","type":"news_article","url":"https://cryptonews.net/news/altcoins/33017031/"},{"credibility":2,"name":"Polygon's zkEVM Never Adopted Blobs, Now Running at a $1M+ Annual Loss — CryptoPotato","type":"news_article","url":"https://cryptopotato.com/polygons-zkevm-never-adopted-blobs-now-running-at-a-1m-annual-loss-researcher-claims/"},{"credibility":2,"name":"Polygon to sunset zkEVM, bets future on cross-chain settlement and stablecoin payments — Cryptopolitan","type":"news_article","url":"https://www.cryptopolitan.com/polygon-to-sunset-zkevm-bets-future-on-cross-chain-settlement-and-stablecoin-payments/"},{"credibility":2,"name":"Polygon Just Let Go of zkEVM, Here's What Replaced It — Blocmates","type":"news_article","url":"https://www.blocmates.com/news-posts/polygon-just-let-go-of-zkevm-here-s-what-replaced-it"},{"credibility":2,"name":"Polygon Shuts Down zkEVM After $1 Million Loss — Bitget News","type":"news_article","url":"https://www.bitget.com/news/detail/12560604821993"},{"credibility":2,"name":"Polygon zkEVM — DeFi TVL, Fees, and Revenue — DefiLlama","type":"on_chain","url":"https://defillama.com/chain/Polygon%20zkEVM"},{"credibility":2,"name":"Action Required: PancakeSwap Sunsetting Support on Polygon zkEVM — PancakeSwap Blog","type":"official","url":"https://blog.pancakeswap.finance/articles/PolygonzkEVMSunset"},{"credibility":2,"name":"Polygon zkEVM Sunset Reminder: Withdraw Assets Before July 1, 2026 — Outposts","type":"news_article","url":"https://outposts.io/article/polygon-zkevm-sunset-reminder-withdraw-assets-before-july-1-0ef46827-b25b-498b-bf7d-f03b03fac95c"},{"credibility":2,"name":"Polygon's ZkEVM Faces Closure Amid Ongoing $1M Yearly Losses — Tron Weekly","type":"news_article","url":"https://www.tronweekly.com/polygons-zkevm-faces-ongoing-1m-yearly-losses/"},{"credibility":3,"name":"QuickSwap sunset warning — X (Twitter)","type":"social_media","url":"https://x.com/QuickswapDEX/status/2066515050932715648"}],"summary":"Polygon zkEVM was a zero-knowledge rollup network launched in March 2023 by Polygon Labs, built upon the 2021 acquisition of Hermez Network for approximately $250 million in MATIC tokens. Despite early promise — including Vitalik Buterin processing the first transaction — the chain never achieved meaningful adoption, reportedly failed to implement the cost-reducing EIP-4844 blobs upgrade, and was shut down on July 1, 2026. Assets locked in DeFi smart contracts at the time of shutdown cannot be auto-migrated and may be permanently inaccessible.","timeline":[{"date":"2021-08-04","event":"Polygon acquires Hermez Network for approximately 250 million MATIC tokens (~$250 million at the time), structured as a token merger at 3.5 MATIC per 1 HEZ.","source":"The Block","source_url":"https://www.theblock.co/post/114479/polygon-hermez-merger-matic-hez-tokens-ethereum-projects"},{"date":"2022-10-11","event":"Polygon releases Hermez-based zkEVM public testnet, allowing Ethereum developers to deploy smart contracts on the ZK rollup without reprogramming.","source":"Invezz","source_url":"https://invezz.com/news/2022/10/11/polygon-announced-the-release-of-the-zkevm-testnet-hermez-can-this-increase-the-value-of-matic/"},{"date":"2023-02-14","event":"Polygon announces March 27, 2023 as the Mainnet Beta launch date for Polygon zkEVM.","source":"CoinDesk","source_url":"https://www.coindesk.com/tech/2023/02/14/polygon-sets-march-date-for-zkevm-mainnet-beta-to-go-live"},{"date":"2023-03-27","event":"Polygon zkEVM Mainnet Beta goes live publicly. Vitalik Buterin sends the first transaction. Nailwal notes it remains in beta and carries technological risk.","source":"CoinDesk","source_url":"https://www.coindesk.com/tech/2023/03/27/polygon-zkevm-mainnet-beta-goes-live-ethereums-buterin-to-process-first-transaction"},{"date":"2024-03-01","event":"Polygon zkEVM total value locked reaches peak of approximately $187 million. The EIP-4844 blobs upgrade is introduced to Ethereum but is allegedly never implemented on Polygon zkEVM.","source":"DefiLlama / CryptoPotato","source_url":"https://cryptopotato.com/polygons-zkevm-never-adopted-blobs-now-running-at-a-1m-annual-loss-researcher-claims/"},{"date":"2024-06-01","event":"Alleged internal work stoppage on Polygon zkEVM Mainnet Beta, approximately 18 months before the official shutdown — according to CEO Marc Boiron's later disclosure.","source":"Crypto Times","source_url":"https://www.cryptotimes.io/2026/07/01/polygon-shuts-down-its-once-flagship-250m-zkevm-on-july-1/"},{"date":"2025-06-11","event":"Sandeep Nailwal assumes CEO role at Polygon Foundation amid strategic restructuring. Polygon announces strategic pivot to PoS chain and AggLayer, and announces zkEVM sunset with 12 months' notice.","source":"CoinDesk","source_url":"https://www.coindesk.com/tech/2025/06/11/polygons-sandeep-nailwal-takes-over-as-foundation-ceo-amid-strategic-shakeup"},{"date":"2025-06-13","event":"Jordi Baylina — original Hermez co-founder and Polygon zkEVM lead — spins off to form Polygon ZisK as an independent entity under SilentSig Switzerland GmbH, taking a team of seven engineers.","source":"The Block","source_url":"https://www.theblock.co/post/358755/polygon-co-founder-spins-off-to-launch-independent-zero-knowledge-project-zisk"},{"date":"2025-06-30","event":"AggLayer v0.3 launches, representing Polygon's new strategic focus on cross-chain settlement.","source":"Cryptopolitan","source_url":"https://www.cryptopolitan.com/polygon-to-sunset-zkevm-bets-future-on-cross-chain-settlement-and-stablecoin-payments/"},{"date":"2026-06-17","event":"QuickSwap DEX issues public warning to users that funds locked in DeFi protocols on Polygon zkEVM will be lost after the July 1 shutdown, and that assets cannot be recovered post-deadline.","source":"QuickSwap on X","source_url":"https://x.com/QuickswapDEX/status/2066515050932715648"},{"date":"2026-07-01","event":"Polygon zkEVM Mainnet Beta sequencer is taken offline. Transactions cease to be processed. Balance snapshot taken for eligible wallet-held asset claims. DeFi-locked funds become inaccessible with no automated recovery pathway.","source":"Polygon Community Forum (official)","source_url":"https://forum.polygon.technology/t/polygon-zkevm-mainnet-beta-sunset-claim-your-funds/21856"}]},"v":1}