Industry News

Balancer DeFi Protocol Moves Toward Shutdown After $128 Million Hack

Blockonomi · 15 Sept 2026

Key Takeaway Businesses using or holding funds in DeFi platforms should treat past exploits as an ongoing risk signal and monitor protocol governance announcements closely, since a breach can undermine a platform's viability long after the initial incident.

Balancer, a decentralised exchange and automated market maker in the DeFi space, is facing closure after a proposal to shut it down was published on its governance forum by CEO Marcus Hardt. A community vote on the plan is expected to run from 25 to 29 September, with the proposal suggesting more than $9 million in remaining treasury assets be distributed to holders of the BAL token.

The protocol's troubles trace back to a November 2025 security breach that drained $128 million from its older v2 stable pools. Revenue collapsed almost immediately afterwards, falling from $1.13 million in October 2025 to $371,000 the following month, and it kept declining through 2026 to just under $57,000 by August, according to DefiLlama data.

Balancer Labs ceased operations in March 2026 but tried to keep the protocol running under a leaner structure, hoping an upgraded version (v3) would drive new growth. Hardt says the restructuring cut costs and honoured commitments to token holders, but revenue never recovered because v3 usage failed to make up for the losses tied to v2.

Summarised by CISO AI from Blockonomi. We link back to every original so you can read it yourself.