Balancer, one of DeFi’s longest-running automated market makers, is asking token holders to approve an orderly wind-down of the protocol and a return of remaining DAO assets to BAL holders.
The plan was posted on the project’s governance forum by treasury council member and former Balancer Labs CEO Marcus Hardt, months after a leaner operating model failed to restore sustainable revenue.
The proposal would stop new product work, shift eligible pools into withdrawals-only mode where contracts allow it, and close the DAO as far as legal and practical limits permit.
Contributor notice would run through October 31, 2026.
On October 30, pausable pools would move to withdrawal-only status, protocol fees would be set to zero where possible, and the bug bounty would end.
From November 1, only a minimal stack needed to process exits would remain.
Hardt argues that continuing current operations would simply spend the treasury to reach the same destination later.
After a November 2025 exploit that drained about $128 million from v2 composable stable pools, monthly protocol revenue collapsed from more than $1 million in October 2025 to tens of thousands of dollars by August 2026.
A March 2026 restructuring cut emissions, redirected fees to the treasury, and shrank the team, but v3 never replaced lost v2 volume.
The proposal says monthly costs still exceed what the protocol earns.
Instead of the previously approved BIP-919 buyback, remaining assets would be distributed in kind and pro rata.
The managed treasury reported by kpk is valued at least $9 million at current token prices; other DAO wallets and positions would be inventoried before the first payout.
BAL held by the treasury would be excluded, except for an allocation owed to tetuBAL holders.
Recovered exploit funds would stay reserved for affected liquidity providers rather than enter the holder distribution.
The first redemption window would open at the end of May 2027, after existing veBAL locks expire, and last six months.
Participating holders would burn BAL tokens and receive a share of the snapshot treasury.
A second airdrop would then go to those same addresses within two months of the close, covering unused wind-down budget, later receipts, and unclaimed shares.
A final sweep six months later would send any remaining inflows to the same group.
Wind-down spending is capped at roughly $400,000, including $150,000 through May 2027, $30,000 afterward, and a $220,000 contingency.
A Snapshot vote is slated for September 25–29. Nothing changes unless the proposal passes.
If it fails, Balancer would stay on its current framework. If it succeeds, the protocol that once held billions in liquidity would spend the next two years exiting users and returning what remains of the treasury rather than funding another attempt at growth.