Zilliqa pivots to Ethereum Layer 2 for regulated institutions

The 2019-era sharding blockchain is giving up its independent Layer 1 status to become a permissioned settlement layer on Ethereum Zilliqa is giving up on being its own blockchain. The project plans to become an Ethereum Layer 2 built specifically for regulated institutions. The new network, called the Zilliqa Institutional Layer, will only process transactions from verified participants. Zilliqa announced the shift on November 4–5, 2026. The core change is structural: instead of settling transactions on its own independent Layer 1 chain, Zilliqa will settle on Ethereum. The defining feature is access control. Only verified participants will be able to transact on the Zilliqa Institutional Layer, which places it firmly in permissioned territory.

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