Why the closure messages of LayerZero and Dango encryption projects are crucial to users
This week, two messages of the closure of encryption projects were successively reported in the DeFi field. LayerZero announced that it would stop offline support for five low-activity chains, while DeFi trading platform Dango was completely shut down. The following is the specific situation verified through official channels.
LayerZero phases out support for five chains
LayerZero confirmed in its official blog that it will phase out offline support for a number of chains with extremely low activity. Once effective, LayerZero's DVN and executor services will no longer be available on these networks.
Botanix, Canto, Moonriver, Moonbeam, Nexera, support for these chains will expire within 30 days. Stargate's v2 protocol will also stop supporting these chains, meaning that Stargate Hydra cannot continue to operate on these chains either.
How should LayerZero and Stargate users respond to
Stargate users who hold Hydra assets (including USDC.e, wETH, or Hydra USDT) on the above five chains, to redeem or bridge these assets as soon as possible. LayerZero recommends moving funds to more liquid chains such as Ethereum, Arbitrum, Base or BSC. If you wait too long, you will face a real risk-once support is completely removed, users may not be able to retrieve the funds left behind on the chain.
The Dango project is officially shut down
At the same time, DeFi trading platform Dango announced that it will be completely shut down. The team stated that despite its best efforts, it was unable to find a viable path to lasting business success. Dango emphasized the safety of user funds and said withdrawal restrictions will be lifted soon.
Dango shutdown timeline: July 29, 2026, at 12:00 UTC, trading will be stopped, open positions will be settled at oracle prices, DLP treasury deposits will be unlocked, and all funds will be returned to the spot account in the form of USDC. At 12:00 UTC on August 13, 2026, the Dango L1 blockchain will completely stop operating, and unwithdrawn deposits will be returned to the original deposit address on Ethereum.
What should Dango users do?
Dango urges users to close positions and withdraw cash as soon as possible, and warns that liquidity may become thin and the risk of slippage cannot be ignored. If users have not processed funds after August 13, they can still get refunds through their Ethereum deposit address, but they can no longer operate through the platform.
Market Impact
As of now, these two pieces of news have not had a serious impact on the token market. LayerZero's own token ZRO is not directly affected because it only involves off-chain infrastructure adjustments for a few low-traffic chains. Dango's previous activity was already limited. According to DefiLlama data, Dango's open interest during operating time is approximately US$1.64 million, with annualized income of approximately US$500,000. Fee income has dropped by approximately 82% in the week before the shutdown announcement. The direct impact of such encryption project closure messages on affected users is often far greater than the impact on the overall market.
Conclusion
From LayerZero's reduction in chain support to the complete shutdown of Dango, this round of closure of encryption projects reveals a common lesson: once data performance is poor, low-activity chains and projects will be quickly eliminated. Users on both platforms have clear deadlines in front of them, and early action is the safest way to avoid asset damage.

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