Lisk, a blockchain network originally founded in 2016 as a Layer 1 blockchain, proposed on August 25 a plan to cease all chain operations by October 31, 2026, if the community approves. The proposal, posted to Lisk's governance forum at 11:54 UTC, would wind down the network less than two years after its Layer 2 mainnet went live in November 2024 and roughly a year after Lisk launched its EMpower Fund in October 2025 to position itself as a dedicated funding partner for African Web3 founders. If approved, the shutdown would close a decade-long blockchain project that was notable for becoming the first major Layer 1 blockchain to fully migrate to an Ethereum Layer 2 via the OP Stack. Four African startups backed through Lisk's venture fund now face an uncertain path forward.

The proposed shutdown reflects a broader pivot by the company. Rather than continuing as blockchain infrastructure, Lisk intends to reposition itself as a financial software business, offering unified bank accounts, stablecoin payment tools, and business approval services to corporate clients. The shift follows the return of co-founder Max Kordek as full-time CEO in December 2025, a move that also brought co-founder Oliver Beddows back as Chief Strategy Officer. According to Lisk's own blog, that leadership reunion triggered a staged wind-down of the company's various initiatives, including the "Onchain" research arm and the "Pass App" wallet product, before the decision to close the chain entirely.

The on-chain numbers paint a stark picture of why the proposed shutdown became difficult to avoid. Lisk's DeFi protocol total value locked (a measure of funds actively deployed in decentralized applications on the network) collapsed from roughly $5.47 million in January 2026 to approximately $139,000 by August, a decline of about 97.5 percent. Readers who cross-reference L2Beat may encounter a figure of $37.14 million in "Total Value Secured"; that metric includes all bridged assets, including the LSK token itself at approximately $21.2 million, rather than only the funds actively deployed in DeFi protocols as counted by DefiLlama. Daily network fees fell to $3.88. Daily trading volume on the chain sat at around $1,700. The LSK token, which once traded at significantly higher levels, has lost approximately 99.6 percent of its all-time high value, and is down roughly 32 percent over the past 30 days alone, worse than the broader crypto market's 24 percent decline over the same period. Lisk's governance proposal calls for burning 100 million LSK tokens in tranches of 15 million per year from 2027 through 2032, with a final 10 million burned in 2033, and transferring approximately 47 million liquid tokens to Lisk Ltd, reducing total supply from 400 million to 300 million over time. No lockup period has been specified for the tokens transferred to Lisk Ltd, a detail likely to concern token holders given the scale of the transfer.

The Africa dimension gives this proposed shutdown particular weight. In October 2025, Lisk launched the EMpower Fund, a $15 million vehicle targeting early-stage Web3 startups in Africa, Latin America, and Southeast Asia, with initial checks of $250,000 per company and maximum exposure of $750,000. The fund was structured to target approximately 40 portfolio companies, taking equity stakes of 3 to 9 percent per investment, with a 10-year fund lifecycle and capital deployed over three years. At the time of this governance proposal, the fund had not completed its first year of that three-year deployment window. Dominic Schwenter, Lisk's COO, framed the fund's mission in direct terms at launch: "Emerging markets are no longer the future of Web3, they are the present. The Lisk EMpower Fund is designed to bridge the capital gap for world-class founders who are building global companies from these ecosystems." Lisk also ran incubation programs across Africa in partnership with CV Labs and AyaHQ, graduating more than 30 startups and providing up to $20,000 in grants to 12 of them. As recently as February 2026, the company announced a partnership with Quidax, the first African cryptocurrency exchange licensed by Nigeria's SEC to formally partner with Lisk, a signal that looked like regulatory momentum at the time.

Four portfolio startups are now directly affected. Azza and ClapMi, both Nigerian companies working on stablecoin payments and social finance respectively, join LovCash from South Africa (supply chain) and Afrikabal from Rwanda (agritech marketplace). Whether Lisk Ltd carries any ongoing obligations to these companies under the EMpower Fund's structure has not been publicly clarified. Azza, ClapMi, LovCash, and Afrikabal did not respond to requests for comment. Lisk is recommending that developers and projects on its network migrate to Celo, another Ethereum-compatible Layer 2 that itself completed a migration to the OP Stack architecture in March 2025. Because both chains now share the same underlying OP Stack foundation, the technical migration is more tractable than it would be across architecturally dissimilar networks. Celo has positioned itself around stablecoin payments and currently ranks as the top Ethereum L2 by daily active users globally; its stablecoin infrastructure, including cUSD and cEUR, already has traction in African payments contexts, which is directly relevant for Nigerian startups like Azza working in that space. The technical migration is feasible, but it does not automatically transfer the community relationships or investor ties these startups built within the Lisk ecosystem.

The timing compounds a difficult funding environment for African blockchain builders. Global blockchain venture capital rose 28.8 percent to $15.4 billion in 2025, but that growth did not reach the continent: blockchain investment across Africa fell 26.6 percent year-over-year to $90.1 million across 28 deals, even as Nigeria's Web3 sector more than doubled from $20 million in 2024 to $43 million in 2025. Critically, roughly 89 percent of Nigerian Web3 funding in 2025 came through grants rather than equity investment, according to data from BitKE, underscoring just how rare a structured equity vehicle like the EMpower Fund was. The fund's blended model combined equity stakes of 3 to 9 percent per company with grant-style incubation support, making it especially unusual in a market where grant-only capital dominates.

Lisk's exit from blockchain infrastructure also serves as a warning for developers across Africa who are evaluating which blockchain ecosystems to build on. The company's model of deploying an Ethereum Layer 2, then using token-based incentives to attract developers and users, broke down when LSK's price fell and fee revenue could not cover the cost of that incentive spending. It is a structural tension that applies to most OP Stack L2 networks, not just Lisk. The governance proposal is still at the community discussion stage and has not gone to a formal on-chain vote. Verse Press will continue covering the vote outcome and any responses from affected African founders.