Acala and Karura (ACA, KAR)

Acala is a decentralized finance network built as a parachain on Polkadot, and Karura is its sister network on Kusama. Holders govern each one through on-chain referenda, with $ACA on Acala and $KAR on Karura. On 9 November 2026 a referendum opened on each network asking holders to approve shutting it down, with both chains to stop producing blocks after 10 February 2027 (Acala Referendum 195, Karura Referendum 137).

Karura won the first parachain auction on Kusama in June 2021 with more than 500,000 $KSM committed by its community (Cointelegraph), and Acala won the first on Polkadot on 18 November 2021 with 32.5m $DOT from 24,934 contributors (Cointelegraph).

Why are Acala and Karura shutting down?

Because, the proposals say, the liquidity a DeFi network needs never arrived, and usage no longer covers the cost of running a dedicated chain. Acala's proposal says the network was meant to be Polkadot's DeFi hub and that Polkadot's multi-chain design split users and liquidity across parachains (Referendum 195); Karura's adds that wallets never made moving between Kusama's parachains smooth (Referendum 137).

Both are signalling referenda: they give the team a mandate, and the on-chain steps follow through each network's own governance. Acala's reached holders through Council motion 449 and Technical Committee proposal 211. A few hours after opening, neither referendum had recorded a vote.

What do holders need to do before the shutdown?

Withdraw anything that came from another chain before 10 February 2027. The two proposals set out the deadlines:

• External assets. $DOT and $USDC on Acala, $KSM and bridged assets on Karura, are to be withdrawn before 10 February 2027.
• Liquid staking. Holders of $LDOT, Acala's liquid-staked $DOT, should unbond before 12 January 2027, because unbonding $DOT takes 28 days, and before 16 December 2026 if they locked $LDOT to specific validators. Holders of $LKSM on Karura should unbond before 2 February 2027, because unbonding $KSM takes 7 days.
• Native tokens. $ACA and $KAR cannot be withdrawn. They stay on their own chains, in the final state the chains are preserved in.
• What is left behind. The teams say they will do their best to return external assets still on the chains to their owners' Asset Hub accounts on Polkadot and Kusama, and that not every asset can be returned. The treasuries' external assets go to the Polkadot Treasury and the Kusama Treasury.

The proposals give a reason for returning and donating assets rather than leaving them on a stopped chain: a chain nobody maintains could be restarted and its governance exploited.

How did Acala's governance handle the 2022 $aUSD error mint?

By suspending the network and then burning the tokens. On 13 August 2022 a misconfigured liquidity-pool contract let liquidity providers mint $aUSD, Acala's stablecoin, in error: about 300 addresses took 3.02bn $aUSD, and $aUSD lost its dollar peg. An emergency governance vote suspended the network, and the team froze most of the error-minted $aUSD it traced on Acala and burned it. Operations came back in three stages, each approved by referendum, from 26 September, and every function was live again on 5 October 2022. All the error-minted value was recovered except 5.8m $aUSD, which the team re-collateralized with its own funds (The Block).

Whether a network's governance should be able to halt the chain and remove tokens from accounts is the question covered in security councils and emergency powers.

Related pages

• Polkadot (DOT & OpenGov), the relay chain Acala runs on
• ZetaChain, a Layer 1 whose holders voted in November 2026 to shut it down and move to Solana
• Winding down a DAO