TreasureDAO to Shut Down Treasure Chain on ZKsync by May 30

TreasureDAO to Shut Down Treasure Chain on ZKsync by May 30

TreasureDAO has announced that it will officially shut down its Treasure Chain, a network built on ZKsync’s layer-2 scaling solution, by May 30. This decision follows the approval of the TIP-52 proposal, which granted the core team emergency powers to execute the shutdown without requiring further votes.

Users Urged to Bridge Out Assets

In a public update shared on May 6, the TreasureDAO team strongly advised users to bridge out all their assets, including non-fungible tokens (NFTs), before the end-of-May deadline. The shutdown is part of a broader strategy to cut costs and refocus resources on product development.

“Bridging to Treasure Chain has been discontinued,” the team stated, adding that “MAGIC-ETH has been migrated to Layer 1 Ethereum and is now tradable on Uniswap, while SMOL-MAGIC liquidity migration to L1 is underway.”

Financial Sustainability and Resource Allocation

The team emphasized that despite the chain shutdown, TreasureDAO remains financially stable, with its USDC reserves expected to last until Fall 2026. This projection excludes a recovering MAGIC treasury, which adds an extra layer of financial security. According to TreasureDAO, the decision to wind down the chain will enable accelerated product development and significantly reduce operational costs.

“The Treasure Chain wind-down will accelerate our product development and reduce operational costs, positioning us for the next stage of growth.”

The team framed this move as a proactive step rather than a setback, stating that retiring the Treasure Chain is a “necessity, not a choice.”

Burn Rate and Cost Challenges

Internal updates from co-founder John Patten revealed the financial challenges prompting this decision. The DAO’s burn rate had become unsustainable, with projections indicating its runway could dry up by late 2025. Maintaining the Treasure Chain cost approximately $450,000 annually—an expense that the treasury could no longer justify, especially considering the slow release of ZKsync grants.

To facilitate the transition, the proposal allows the team to manage approximately 3.18 million MAGIC tokens and 138 ETH in DAO-owned liquidity. The shutdown is portrayed as an emergency measure to address extraordinary circumstances, rather than a shift in governance principles.

TreasureDAO’s Journey and Future Focus

TreasureDAO was an early builder on Arbitrum before launching its own chain on ZKsync. At its peak, Treasure Chain accounted for over 95% of all gaming and NFT transactions on Arbitrum and generated more than $260 million in marketplace volume since its inception.

As the DAO pivots to a leaner operational model, its focus will shift toward product innovation and long-term growth, ensuring its financial and strategic resources are allocated effectively.