MilkyWay Protocol is officially calling it quits. The team announced a gradual phase-out and permanent shutdown, citing a lack of expected demand in DeFi and the WayCard product's failure to alleviate financial pressures as the main reasons.
The project began as Celestia's first liquid staking token (LST) before expanding into the Initia and Babylon ecosystems. It later dabbled in restaking, real-world asset (RWA) tokenization, and neobank-style products. However, the team noted that the DeFi ecosystem matured slower than anticipated, interest in restaking faded quickly, and planned RWA collaborations fell through due to unforeseen issues.
The WayCard product, designed for daily expenses and rent payments, also failed to find product-market fit due to limited "runway." As part of the shutdown, all features are disabled effective immediately, with a complete system shutdown scheduled for a later date.
In a move to return value, MilkyWay will distribute accumulated protocol fees to users. The protocol earned a 10% cut from liquid staking fees, and these funds will be converted to USDC and distributed proportionally to MILK token holders. A single on-chain snapshot was taken on January 14, 2026, at 13:00 (UTC+3), capturing MILK balances, stakers, liquidity providers, and exchange-held tokens across MilkyWay L1, BSC, and Osmosis. Transfers after the snapshot won't affect entitlements.
USDC distribution will be automatic—no separate claim process needed. For users holding MILK on centralized exchanges, distributions will be coordinated through the exchanges. Additionally, all remaining tokens reserved for the team, foundation, community, and ecosystem, including undistributed airdrop shares, will be burned and removed from circulation.
The MILK token has dropped 6% in the last 24 hours and 42% over the past month. *This is not investment advice.
