NilChain, the privacy-focused blockchain built by Nillion using the Cosmos SDK, is scaling back its operations on Cosmos as part of a broader ecosystem-wide transition to focus on interoperability.
In X’s announcement on February 17, the team stated that the network would cease operations on March 23, and urged holders of NIL tokens to migrate their assets to Ethereum before the closure.
NilChain was designed as a network for secure computation. However, this chain does not seem to have achieved widespread use within the Cosmos ecosystem.
However, leaving Cosmos does not mean the end of Nillion itself, as the company plans to continue operating on Ethereum. Amid this news, nilChain’s native token NIL soared more than 10% on the day to $0.06 and is currently trading around $0.053, according to data from CoinGecko.
It remains unclear why the team decided to move away from Cosmos. The Nillion team declined The Defiant’s request for comment on the move for this article.
NilChain may not be as widely known as larger Layer 1 or Layer 2 networks, but Nillion has raised a lot of funding. In December 2022, the company closed a seed round of approximately $20 million led by Distributed Global with participation from GSR Markets and HashKey.
In October 2024, the company raised another $25 million in a round led by Hack VC with support from Arbitrum Foundation, Worldcoin, sei, HashKey Capital, and Animoca Brands.
Escape from the Cosmos
The move comes as Cosmos itself reevaluates its direction. In July 2025, Cosmos Hub canceled plans to add support for native smart contracts, citing high costs and weak developer demand. Teams that were planning to deploy applications on the hub were encouraged to build on other Cosmos-based chains instead.
This change forced many teams to reset, and at the same time led to a number of team departures. Since mid-2025, several projects have announced termination or downsizing across the Cosmos ecosystem.
Stablecoin-focused project Noble announced earlier this year that it would task Cosmos with launching its own EVM-compatible L1, saying the team hoped to “meet users and developers where they already are.” Some chains have gone a different route, with chains like Pryzm and Quasar announcing closures or major changes.
Some have publicly said they will leave Cosmos after years of struggling with liquidity, user distribution, and developer traction after Terra’s collapse in 2022. Others, including infrastructure providers, argue that the ecosystem still makes sense for teams focused on interoperability rather than consumer DeFi.
TVL, Cosmos Hub app revenue and fees. Source: Defilama
The Cosmos Hub itself has also seen a decline in activity. The total amount locked on the network is at an all-time low, down from about $2.65 million earlier this month to about $131,000, according to data from DefiLlama.
Network charges have also dropped significantly. By January, fees had hit an all-time low of about $218,000, and only four of the 11 protocols deployed on Cosmos Hub were profitable.
According to CoinGecko, Cosmos Hub’s native token, ATOM, has fallen about 4% in the past 24 hours, despite gaining more than 18% over the past week.
