On March 28, 2023, Bifrost launched vFIL, the Liquid Staking Token of Filecoin. vFIL was the first DePIN LST on Bifrost, marking a bold attempt to enter the heterogeneous blockchain LST market. Since its launch, Bifrost has provided Filecoin holders with a decentralized and secure LST service, with vFIL reaching a TVM peak of 100,000. However, the current vFIL service has faced several limitations.

Insufficient cross-chain experience: The security audit mechanism of the multi-signature cross-chain bridge has led to a less-than-smooth experience.
Lack of on-chain applications: There is a shortage of efficient use cases for vFIL.
Limited ecosystem synergy: vFIL has not been deeply integrated with FEVM, resulting in limited ecosystem collaboration.
Insufficient decentralization support: The operational mechanism lacks sufficient support for the integration of decentralized storage providers (SPs).
Inefficient redemption mechanism: Redemption cycles are long, with high uncertainty.
Low market liquidity: The vFIL secondary market price has remained low, and market activity has been sluggish.

Given that the current design and infrastructure of vFIL cannot meet the needs of users and SPs, and the service quality does not align with Bifrost’s LST standards, Bifrost has proposed a graceful shutdown of vFIL.

vFIL Shutdown Process

The shutdown of vFIL service will take place in stages, giving holders enough time to complete their redemptions. The detailed timeline is as follows:

Phase 1 (Q4 2024)

Stop FIL deposits into Bifrost (Completed)
Stop vFIL minting (Scheduled for governance execution on December 31, 2024)

Phase 2 (Q1 2025)

Await the gradual expiration of FIL wrapped by Filecoin storage providers (SPs)
Upon expiration, the unlocked FIL will be transferred to Bifrost’s vFIL Ready Pool.

Wrapped FIL Expiration Dates:

f079426: October 24, 2024 (Expired)
f02182258: November 3, 2024 (Expired)
f0111584: February 1, 2025

Phase 3 (Q2 2025)

Decommission on-chain vFIL asset custody
Enable users to redeem vFIL at any time and directly swap back to FIL via fast redemption.
Allow users to transfer FIL back to the Filecoin network via the cross-chain bridge.

Phase 4 (By June 30, 2025)

Disable FIL cross-chain bridge between Bifrost Chain and Filecoin network.
After the bridge closed, vFIL can still be redeemed, but FIL will no longer be able to be immediately transferred back to the Filecoin network.

Phase 5 (After June 30, 2025)

Decommission on-chain modules related to FIL cross-chain transfers
Users can still use Bifrost governance proposals to cross-chain FIL back to the Filecoin network, although this process may take several months

User Guide

Self-Redemption: It is recommended to complete vFIL redemption and cross-chain FIL to the Filecoin network before the end of Phase 3 to avoid complications after the cross-chain service is halted.
Asset Check: Ensure that you check assets in farming pools, any LP assets you hold, or vFIL assets cross-chained to Moonbeam to complete redemption in a timely manner.
Governance Redemption: After the service is decommissioned (Phase 4), users can still initiate governance proposals to cross-chain FIL back to the Filecoin network, but this method may take several months to process.

Future Plans

The shutdown of vFIL service does not mean that Bifrost gives up FIL LST and related business development. On the contrary, it reflects Bifrost’s reevaluation and optimization of the current mechanism and service model.

In the future, Bifrost may relaunch the FIL LST business under more favorable conditions, leveraging the lessons learned to deliver:

Improved user experiences.
More secure solutions.
Greater ecosystem collaboration and value creation.

At that time, the on-chain vFIL and FIL assets retained will seamlessly integrated into future services, continuing to generate value for the community and users.