Written by Martin Youngstaff writerReviewed by Felix Ngstaff editor
Written by Martin Youngstaff writer
Reviewed by Felix Ngstaff editor
Secret Network cites AI exploit risks in proposed Arbitrum move
Latest NewsPublishedJul 8, 2026
Why a Major Blockchain is Leaving its Home Network
The Secret Network, a privacy-focused blockchain, is planning to move from its current home on Cosmos to Ethereum layer-2 Arbitrum. This decision is driven by security risks, particularly those related to artificial intelligence. The team behind the Secret Network takes the security risk very seriously, citing old code and AI exploit risks as major concerns.
The environment has changed since the Secret Network started running on Cosmos in 2020. With the release of advanced AI models, the capabilities for discovering and potentially exploiting code vulnerabilities have increased dramatically. This has made it easier for attackers to analyze and exploit old code, which is a significant security risk. The recent Axelar-Secret IBC bridge exploit highlighted this growing risk, and the team believes that AI-assisted exploitation is making it worse.
Reasons for the Move
The Secret Network team has described Arbitrum as having deep liquidity, tooling, wallet and exchange support, and thousands of builders composing with one another. In contrast, the team notes that liquidity has thinned on Cosmos, and many builders have drifted to other ecosystems. The tooling that the Secret Network relies on is also shakier than it used to be, with many projects that once anchored Cosmos having migrated to other ecosystems.
The proposal to move to Arbitrum requires a governance vote and follows a bridge exploit in June that resulted in the loss of $4.7 million in bridged assets. The team is planning a one-time snapshot of SCRT balances on September 1, which will be used to issue a new ERC-20 SCRT contract on Arbitrum. This move is expected to provide a new stable home for the Secret Network and its native token, SCRT.
Impact on the Ecosystem
The total value locked in the Cosmos ecosystem has decreased significantly, from a peak of around $2 billion during the 2021 bull market to around $2 billion, down 88%. In contrast, Arbitrum is the leading layer-2 network by total value secured, with around $17.4 billion. The Secret Network has just $1.3 million in TVL on Cosmos, according to DefiLlama.
Liquidity has thinned
Other networks have also left the Cosmos ecosystem, including NilChain, Sei Network, and Noble. The Secret Network’s decision to move to Arbitrum is driven by the need for a more secure and stable environment, which is essential for the long-term survival of its native token, SCRT.
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For SCRT to endure, it needs a new stable home, and the Ethereum ecosystem is that home, the team said.
The team is planning a one-time snapshot of SCRT balances on Sept. 1, which will be used to issue a new ERC-20 SCRT contract on Arbitrum.
Dwindling DeFi value locked
The total value locked in the Cosmos ecosystem is around $2 billion, down 88% from its peak during the 2021 bull market. Comparatively, Arbitrum is the leading layer-2 network by total value secured, which is $17.4 billion, according to L2Beat.
Secret Network has just $1.3 million in TVL on Cosmos, according to DefiLlama.
SCRT holders did not react well to the news, with the token tanking 24% over the past 24 hours to 4.1 cents, down more than 99% from its 2021 peak, according to CoinGecko.
Secret is not the only network to leave Cosmos. In February, privacy-focused blockchain NilChain, built with the Cosmos SDK, left the ecosystem in a move to Ethereum.
The Sei Network completed a full Cosmos-to-EVM transition in June, closing down its native Cosmos transaction layer entirely and becoming Ethereum-based.
Stablecoin blockchain Noble also announced it was moving from the Cosmos ecosystem to Ethereum in January.
Features: The biggest blockchain upgrades still to come in 2026
Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.
- Cosmos
- Privacy
- Arbitrum
- Layer2
- Blockchain
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