Polynomial Shuts Down DeFi Derivatives Platform, Cancels Token Launch And Initiates Withdrawal Deadline For Users

by
Alisa Davidson

Printed: February 16, 2026 at 2:13 am Up to date: February 16, 2026 at 2:13 am

by Ana

Edited and fact-checked:
February 16, 2026 at 2:13 am

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Polynomial, a decentralized finance derivatives protocol, introduced that it has ceased all operations, together with the shutdown of each Polynomial Chain and Polynomial Commerce. 

In line with the undertaking’s timeline, market exercise was suspended on February thirteenth, with pressured closure of all positions scheduled to start on February 18th. The liquidity layer is about to be deactivated on February twenty fourth, adopted by a full chain shutdown on March third. Customers have been urged to withdraw funds earlier than February 24, with the workforce stating that assist will stay accessible all through the method.

The undertaking had beforehand introduced plans for a token era occasion within the first quarter, however the workforce confirmed that the launch will now not happen. As an alternative, the shutdown will proceed, with the workforce citing considerations about releasing a token for what it described as a declining product. A snapshot has been taken of all members, and the workforce indicated that early supporters will obtain precedence if the undertaking returns sooner or later.

Polynomial highlighted the scope of what it had constructed, noting the event of greater than 70 markets spanning crypto, equities, commodities, overseas alternate, and indices. The protocol launched what it described as the primary hybrid perpetuals mannequin combining automated market makers with an order guide system, together with multi‑collateral performance and gasless buying and selling designed to resemble centralized alternate efficiency. 

The workforce emphasised that the underlying expertise was strong, pointing to greater than $4 billion in cumulative buying and selling quantity, over 27 million transactions, a person base of twenty-two,000 members, and peak whole worth locked of $8 million.

Polynomial Cites Liquidity Deficit As Core Purpose Behind Derivatives Platform Shutdown

Regardless of these achievements, the workforce said that sturdy technical efficiency was not sufficient to safe a aggressive place within the derivatives sector. They famous that enhancements in execution velocity, person expertise, and infrastructure didn’t translate into sustained traction, as merchants constantly gravitated towards platforms with deeper liquidity. 

In line with the announcement, liquidity proved to be the decisive issue, overshadowing innovation and have growth. The workforce stated it noticed this dynamic firsthand as whole worth locked declined from its peak.

In reflecting on the broader market atmosphere, Polynomial described a shift in how merchandise have to be in-built an more and more automated ecosystem. The workforce said that the standard assumption that top‑high quality expertise would naturally entice customers now not holds, arguing as a substitute that liquidity compounds whereas options don’t. They acknowledged that the protocol’s thesis on the expansion of on‑chain derivatives was appropriate, noting that the sector has expanded considerably lately, however conceded that their very own execution fell quick.

The workforce reported that the protocol’s 27 million transactions have supplied in depth perception into person conduct and market construction, giving them a clearer understanding of what constitutes a defensible place within the derivatives panorama. In a message to merchants, liquidity suppliers, and neighborhood members, Polynomial expressed appreciation for the assist obtained and reiterated that person funds stay safe. The workforce emphasised that the shutdown is being performed fastidiously out of respect for the neighborhood.

Polynomial said that it isn’t abandoning its lengthy‑time period mission of enabling scalable on‑chain derivatives. The announcement concluded with a sign that the workforce intends to return with a renewed concentrate on constructing liquidity first, sustaining the identical mission and workforce whereas aiming for stronger execution. The group added that every one present readers will obtain early entry when the undertaking reemerges, describing the pause as a step towards reloading relatively than ending its efforts within the sector.

Alisa, a devoted journalist on the MPost, makes a speciality of cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a eager eye for rising developments and applied sciences, she delivers complete protection to tell and interact readers within the ever-evolving panorama of digital finance.

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