Korbit-Backed Ethereum L2 Silicon Is Shutting Down With Nearly $10 Million Still On-Chain and a Dec 31 Deadline
Silicon, the Polygon CDK layer 2 built in 2024 by South Korean exchange Korbit (now DigitalX) with Ozys and Hidow, stopped accepting deposits this week and will switch off its network and explorer after December 31. About $9.75 million in USDC, WBTC, ETH and USDT remains on the chain and must be bridged out by users themselves.
Silicon, an Ethereum layer 2 network created to connect customers of South Korean exchange Korbit with on-chain applications, is winding down less than two years after launch. The network issued a developer notice on September 2, suspended new deposits, and set December 31, 2026 as the final date for users to withdraw. After that, the chain and its block explorer will be switched off, and anything left behind may be unrecoverable.
What Silicon was
Silicon was built in 2024 by Korbit, which has since renamed itself DigitalX, together with Korean blockchain developers Ozys and Hidow, according to Bloomingbit's Joon Hyoung Lee. It used Polygon's CDK stack, was connected to Polygon's Agglayer, and was designed by benchmarking Coinbase's Base chain. Its main consumer product was the Korbit Web3 Wallet, which let exchange customers reach DeFi and decentralized apps without leaving the Korbit ecosystem. DigitalX's stated reason for the shutdown is that it is exiting the proprietary wallet business; the wallet is being discontinued alongside the chain.
What is still on the chain
L2Beat data cited by CryptoSlate's Oluwapelumi Adejumo puts Silicon's total value at about $9.75 million at the time of the announcement:
USDC: about $2.66 million
WBTC: about $2.54 million
ETH: about $2.08 million
USDT: about $1.85 million
Silicon's own notice, as quoted by CryptoSlate, frames the responsibility plainly: the network is a non-custodial service, meaning that the custody and withdrawal of assets are managed directly by each user. In other words, nobody will sweep the funds back to Ethereum on holders' behalf.
How to get out, and who cannot
Assets that were bridged in from Ethereum mainnet, which covers the four large balances above, can be bridged back during the window. Users holding funds in external wallets must start the withdrawal themselves, keep enough ETH on Silicon to pay gas, and make sure the transaction finalizes on Ethereum before the cutoff, since a withdrawal started too late can be stuck when the sequencer stops. Tokens that were issued directly on Silicon rather than bridged have no canonical path to Ethereum; their holders depend on whatever liquidity remains on the network's shrinking DEX pools to swap into a bridgeable asset first.
Korbit Web3 Wallet users are in a somewhat better position because the exchange controls the interface, but they should not assume the exchange will move funds for them; the notice says otherwise.
Why it matters beyond Korea
Silicon is small, and $9.75 million is a rounding error next to the roughly $2.5 billion bridged to Robinhood Chain in its first two months. But it is a clean example of a risk that rollup marketing tends to skip: a layer 2 is only as permanent as the company running its sequencer. Polygon CDK and similar stacks make launching a chain cheap, which also makes abandoning one cheap. Users of any exchange-branded or app-specific L2 should know which of their assets have a canonical bridge to Ethereum, and treat anything without one as an IOU on the operator's continued interest.
Sources differ by a day on when deposits stopped, with CryptoSlate and Coingabbar citing September 2 and Bloomingbit September 3 following the September 2 notice. The December 31 deadline is consistent across all three.