Balancer Labs, the team behind the DeFi protocol Balancer, is shutting down following a $116 million hack in November. Founders said the entity has become a liability, not an asset. Executives are proposing a leaner structure to sustain the protocol.
The protocol, once reaching $3.3 billion in total value locked, now stands at $158 million. Martinelli cited ongoing legal exposure from the exploit as a key factor in the decision. The plan includes zero BAL emissions, fee restructuring, and reduced costs. The Balancer DAO will vote on proposals to reshape operations and tokenomics.
"The problem isn't that Balancer doesn't work," Martinelli said. "The problem is that the economics around Balancer aren't working."