Balancer Holders Approve Shutdown to Veto Fork
BAL holders have approved the orderly shutdown proposal BIP-928, while the fork proposal BIP-929, which aimed to continue Balancer technology under a new name, was not passed. Existing liquidity pools will operate until October 30, with withdrawal channels remaining open throughout.
BIP-928 received over 99% support from approximately 17.2 million BAL voting rights, with 42 votes participating; BIP-929 had about 17.3 million voting rights, with 51 votes participating, and approximately 70% opposed. Both proposals exceeded the quorum of 5 million BAL. The shutdown plan was drafted by former Balancer Labs CEO Marcus Hardt. The rejected fork was led by long-time contributors Gosuto and Zekraken under MAXYZ, which originally planned to maintain the liquidity pools until the end of Q2 2027 and grant up to approximately 6 million non-circulating BAL to a new entity.
The timeline is set: partners can apply to extend specific V3 liquidity pools until November 30, with the deadline being October 16; on October 30, liquidity pools can be switched to withdrawal-only, and the bug bounty will end simultaneously; V3 Vault will be paused on November 30. The protocol states that contracts are non-custodial, and withdrawals do not rely on the team continuing operations. Voting day DefiLlama shows that V2 and V3 have a total locked value of approximately $52.4 million to $58.5 million.
BAL holders do not need to take action at this time. Starting from the end of the veBAL lock-up period in late May 2027, holders can burn BAL and proportionally claim DAO treasury assets, with a claim window of about six months, and the specific opening date will be announced at least two weeks in advance. Hardt estimated on September 20 that approximately $9.96 million of treasury assets would be available for distribution, corresponding to about 63.07 million redeemable BAL, approximately $0.1579 each, emphasizing that the figures are unaudited and the final numbers will be based on the claim snapshot. TetuBAL is calculated at 50% of the locked token value in BAL. The previous cap for treasury buybacks of 35% under BIP-919 has also been canceled.
After the V2 liquidity pool was attacked for about $128 million in November 2025, Balancer Labs announced its shutdown in March this year. In August, protocol revenue was about $30,000, down from about $97,000 in June, with most still coming from V2; monthly expenses are about $150,000. The project will issue separate guidelines for withdrawing liquidity from pools using applications, third-party tools, and direct on-chain operations.
In market mechanics, this is an event-driven liquidation: sellers are liquidity providers withdrawing and token holders waiting for treasury distribution, while buyers have nearly disappeared as new business has stopped, fees are zero, and the security budget no longer covers after the bounty deadline. Funds flow from pool assets to user wallets, and from the treasury to addresses burning BAL. Beneficiaries are LPs who can exit in an orderly manner before October 30, and holders estimated to receive about $0.16 waiting for distribution in 2027; those under pressure are the contributing teams hoping for an official fork to extend their lifeline, and veBAL positions whose lock-up has not yet expired, with distributions postponed until May next year. The non-custodial structure shifts the payout risk from operators to users themselves for withdrawals.
Source: Public Information
ABAB AI Insight
Hardt personally wrote the shutdown proposal after the main lab ceased operations, effectively acknowledging that the protocol has reverted from a product organization to a treasury shell awaiting distribution. The background is the theft of about $128 million from V2 in November 2025, and V3 has not revitalized revenue, with August protocol revenue at $30,000 against monthly expenses of about $150,000. The cancellation of the BIP-919 buyback indicates that governance no longer believes that using treasury funds can lead to rebirth, opting instead to leave remaining assets to the tokens. MAXYZ aimed for an official fork to take approximately 6 million non-circulating BAL, but the vote saw 70% oppose it, as holders chose a one-time liquidation rather than granting the contributor team another lifeline.
The capital path is to first halt operations, then wait for the lock-up period, and finally destroy for payout. The October 30 switch to withdrawal-only and the November 30 Vault pause separate LP assets from token claims: LPs can exit now, while BAL must wait until May 2027 when all veBAL expires. The $9.96 million for 63.07 million tokens means pricing power is no longer in the secondary market but in the claim snapshot. The treasury distributes proportionally in kind, avoiding the cycle of buybacks. Funds are not directed towards new chains or brands but are returned from the DAO balance sheet to token holders.
In comparison, many DeFi protocols that have been hacked have either rebranded forks to spread costs or directly distributed treasury assets. Balancer chose the latter, positioning itself in a liquidation phase rather than a transformation phase. Curve and Uniswap still rely on trading fees to sustain governance tokens; Balancer's V2 revenue residuals and insufficient V3 penetration have eroded the voting basis for "protocol as a continuing enterprise." The MAXYZ path led by Gosuto and Zekraken is closer to historical cases of officially sanctioned forks, but this time holders refused to delegate the remaining brand value again.
Structurally, this represents a reverse disassembly after capital concentration. The mechanism is: security events erode trust, revenue cannot cover operations, and governance power shifts from "maintaining the protocol" to "distributing the remnants." Non-custodial contracts allow shutdowns without freezing user assets, only freezing new risk exposures. Pricing power shifts from transaction fees to treasury net value divided by the number of redeemable tokens. When a decentralized exchange no longer generates sufficient cash flow to cover bounties and development, tokens revert from governance warrants to liquidation certificates.
ABAB News · Cognitive Laws
When revenue cannot cover expenses, governance votes will shift to liquidation.
Non-custodial structures reduce shutdown costs and eliminate the excuse for lifelines.
Lock-up periods determine payout dates, not whether the protocol is still alive.