Balancer Proposes Shutdown Amid $128M Exploit and Revenue Collapse

Balancer's proposal to wind down operations is sparking controversy in the DeFi space. The move comes after a $128 million exploit and revenue collapse. According to data from DefiLlama, monthly protocol revenue fell from $1.13 million in October 2025 to $56,781 by August 2026.

The exploit occurred in November 2025 when an attacker manipulated pool balances during token swaps to drain assets from the v2 Composable Stable Pools. Estimates put the loss at around $128 million across Ethereum and other networks.

BALancer Labs CEO Marcus Hardt proposed a phased shutdown of the DeFi protocol, which would involve returning the remaining treasury to BAL holders and dissolving its DAO. The plan also includes distributing over $9 million in treasury funds to token holders who burn their tokens.