The team observed that the governance decision to close the network was reached since, being an application-specific blockchain (app chain) targeted on derivatives trading, the network did not see much traction in its present form. As indicated, the Vega team will make use of its resources to solely develop and preserve the basic software.

“While we’re proud of the software we’ve built, the chain and token have not seen the interest and growth necessary to be sustainable and let the project continue in its current form,” said Vega Protocol co-founder Barney Mannerings.

Apart from the continuous transformation, the Vega core developers will assist a distributed exchange known as Nebula. Independent project Nebula makes use of Vega’s basic tools. This will have a NEB token all its own, meant for VEGA token holders.

“We believe the future of the software will be as an open-source protocol for others to build upon. Nebula is poised to do just that, and they are also offering NEB tokens to VEGA token holders, giving them some utility despite being an independent project,” Mannerings stated.

The shift also marks the chain into a “ramp down” phase in which validators are expected to maintain node functionality, enabling the withdrawal of cash from the network. The core team said on a blog post that the validators have said the Vega chain will remain operational until at least Oct. 27, giving customers an opportunity to withdraw their assets.

“Please look out for further updates or announcements and remember that if and when the chain halts, assets may become stuck on the bridge. If this happens, the team will not be able to retrieve them for you.” The team will not be able to retrieve them for you.

From $0.1 to $0.0625 at time of writing, the Vega token’s price dropped thirty percent during the past week. Over 90% year-to-date, the token has dropped Published in 2018, Vega’s whitepaper details a performance-oriented, application-specific blockchain developed on the Tendermint proof-of-stake consensus mechanism. Under Pantera Capital, the team brought up a $5 million seed investment in 2019. The team then raised $43 million in 2021 by doing a community token sale on CoinList.

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Nebula will let VEGA’s token holders sell their tokens for NEB, its own currency. According to the official Vega Governance plan, trading should stop, stakers should be provided on-chain Treasury, and inspectors should obtain USDT incentives to help to preserve the network intact for the next two months. Users might then withdraw their money from the Vega DEX before the network closes.

The idea underlines how Vega Protocol’s constant operation would exist even with the planned alpha mainnet chain shutdown. The concept is really popular right now with just 200 tokens against and 1.7 million tokens voting in favor. Voting ends on September 6 and requires 2.5% participation level for passing suggestions on government.

Still, the proposal has drawn criticism not without reason. Commentator on cryptocurrencies SpEEK said the extra NEB funds would almost five times reduce the distribution of current holders. Besides suffering is the value of the VEGA token; it lost over 64% over the last month and over 17% over the previous 24 hours. Now trading at $0.06, VEGA dropped 95% during the previous year shown above.

Originally introduced in 2018, Vega Protocol positioned itself as a blockchain fit for high-volume derivatives trading using a whitepaper stressing scalability and rapid settlement times. Lead by Pantera Capital, the platform raised $5 million in a seed fund in 2019 and $43 million in a community fund in 2021.

Figures from DeFiLama show that even with the current TVL of Vega at $424,000, it is far from competitors such as Hyperliquid and dYdX with respective TVLs of $541 million and $395 million. Nebula’s proposed rereading of its function in the distributed trading system is as interesting, as it might help the platform to materialize.

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