Key highlights:
- Balancer CEO Marcus Hardt has proposed a phased shutdown of the DeFi protocol.
- Monthly protocol revenue fell from $1.13 million in October 2025 to $56,781 by August 2026.
- The firm could distribute over $9 million in treasury funds to BAL holders.
Decentralized exchange Balancer has asked its token holders to vote on shutting the protocol down. This comes nearly a year after a $128 million exploit drained its liquidity pools and sent revenue into a steep decline.
Balancer Labs CEO Marcus Hardt
Revenue in general has been a major bone of contention in the crypto space, with many protocols and exchanges recording losses.
Balancer Labs, the corporate branch of the protocol, shut down in March 2026 after executives concluded the company was too costly to keep running given the lawsuits tied to the exploit.
Details of the wind-down plan
The proposal said that all new business development would end immediately, and the protocol’s left treasury balance, around $9 million, would be distributed to BAL token holders.
Holders would need to burn their tokens to claim their share, which would then be paid out in kind and in proportion to how many tokens they hold. The plan would also cancel a previously approved BAL buyback program in favor of this treasury distribution. The shutdown would begin next month if approved.
Liquidity providers would have until Oct. 30 to exit, after which pools that can be paused would switch to withdrawal-only mode. Pools that cannot be paused would keep running.
By Nov. 1, the protocol would scale down to just the infrastructure needed to process withdrawals, with a small team overseeing the transition and $400,000 set aside to cover wind-down costs.
The first distribution to BAL holders could potentially start at the end of May 2027 and run for about six months. There could be a second distribution for any unspent funds or unclaimed shares, and a final sweep of assets about six months after that.
Vote set for late September
The plan now awaits a governance vote running as a snapshot ballot from Sept. 25 to Sept. 29, with a quorum requirement of 5 million BAL tokens. If holders reject the proposal, Balancer would keep operating.
Hardt said delaying the decision would only cost token holders more in the long run.
“Continuing on the current path spends the treasury to arrive at the same place later. That treasury belongs to BAL holders,” he said. “The question is whether what remains reaches holders while it is still substantial, or is spent first on a path that has already been tried.”
Source:: Balancer Wants to Wind Down Operations After a $128M Exploit and Revenue Collapse