Polkadot parachain Phala is set to transition to Ethereum Layer 2 following a community vote approving a proposal to expand its computational offerings for enterprise clients.
“Proposal Passed: Phala is Migrating to Ethereum L2!” announced a Phala X post on Wednesday, describing the move as the next chapter for the project, aimed at delivering “greater scalability and enterprise-grade security.”
The post also confirmed that Phala (PHA) tokenholders will receive the new ERC-20 version at a 1:1 ratio. The migration is scheduled to begin before November 20, and “staking, rewards, and governance” will continue seamlessly on the Ethereum L2 network.
Phala’s transition to Ethereum isn’t sudden, as the project already launched a “live and functional” Ethereum L2 in January. According to the proposal, the full migration aims to concentrate efforts on Ethereum to maximize growth potential.
Phala is a decentralized cloud computing network built to provide private, secure, and scalable computation for AI-powered Web3 applications. It was among the first projects to secure a Polkadot parachain slot during the late 2021 auctions.
The migration proposal, submitted on September 27 by Phala Network ecosystem lead “doylegxd,” recommended consolidating staking, governance, and confidential computing within a “stronger” Ethereum Virtual Machine-aligned ecosystem. The proposal noted that renewing the Polkadot parachain slot would tie the project to “infrastructure with limited scalability,” demanding significant resources to maintain, while Ethereum would allow access to next-generation computation technologies.
“L2 offers lower operational overhead and direct integration with Ethereum liquidity and tooling. It is also the natural home for deploying TDX and GPU-based confidential compute workloads, where we already see early-stage commercial traction,” the proposal stated.
Why migrate from Polkadot?
Phala seems to be among the few projects fully moving from Polkadot to Ethereum. Other networks, such as Astar and KILT Protocol, have chosen a multichain approach, integrating with Ethereum without abandoning Polkadot entirely.
The proposal indicates that Phala’s move is designed to leverage specialized technologies critical for its future growth.
The PHALA token currently ranks as the 11th largest AI-agent-related cryptocurrency by market capitalization, valued at $80.6 million, and is among the top 50 AI tokens overall, according to CoinGecko.
