Terminal Finance says it would not launch its highly anticipated decentralized exchange, Terminal, after the Converge blockchain failed to go live.
This follows the company’s gathering of more than $280 million in total value locked (TVL) ahead of its upcoming launch at the end of this year, according to DefiLlama. The pre-deposit phase spanned three capped vaults holding 225 million USDe, 10,000 ether, and 100 bitcoin. Data from DeFiLlama shows the vaults have reached full capacity.
Terminal Finance explained in its X post that “launching just to launch a project goes against our principles,” and that advancing a project in suboptimal conditions would compromise the project’s integrity and sustainability.
Some X users applauded the firm for making the bold move. One user said, “Respect for this part, such an approach is not often seen today. Preserving integrity is paramount. Wishing the whole Terminal team all the best.”
Others expressed disappointment. One user said, “That’s terrible, definitely Ethena fault that made this converge chain the center of its proposition (which I think was a great idea).”
Converge delay blocks Terminal’s ambitious DeFi launch
Terminal Finance was designed to serve as the liquidity hub for Converge, which Ethena Labs envisioned as a bridge between traditional finance and decentralized finance through the integration of transaction processing mechanisms.
Converge was built to house permissionless DeFi applications and permissioned institutional products, with fast blocktimes, staked validator networks, and yield-bearing stablecoins such as USDe and sUSDe.
Terminal’s architecture hybridized an order-book for limit orders with automated market maker (AMM) pools to assure liquidity and facilitate immediate execution. It was also designed to trade key crypto assets alongside tokenized real-world assets.
Even before its launch, Terminal Finance had hosted over $280 million in pre-launch deposits across various vaults, demonstrating that investors had faith, with large USDe, WETH, and WBTC deposits, and over 10,000 wallets participating in the pre-launch phase.
For the DEX, the official launch was expected to take place in the first quarter of 2025 alongside a token generation incentive event. But the Converge blockchain did not launch as planned, and as a result, the protocol was left without the ecosystem it was established to build around.
The team considered several possible pivots, such as switching to a new chain or revising the protocol; however, all had material barriers in the way, including limited support, low asset onboarding potential, and poor long-term prospects.
Users secured as Terminal Finance plans open-source exit
Terminal Finance informed users that all principal deposits are fully backed (1:1) and can be withdrawn at any time. Prior Pendle positions are still eligible for rewards, including Ethena Sats, sUSDe yields, and Etherfi points. The company also plans to open-source its fully audited codebase, which might allow developers or community projects to reuse or adapt Terminal’s technology.
It also illustrates the risk associated with ambitious DeFi projects built on blockchain infrastructure that hasn’t yet been fully rolled out.
Terminal Finance says the decision was not easy for them, but it was called for. The company has expressed its disappointment to liquidity providers, ambassadors, and the broader community, but also acknowledged that honesty is key.
The team hopes its open-source protocol will enable it to remain credible within the ecosystem while paving the way for future innovations.
