Balancer Labs is set to shut down as the team behind the DeFi protocol looks to cut costs after months of financial pressure. Moving forward, the protocol itself will continue, but management will shift to the Balancer Foundation and the DAO, while the corporate entity winds down.
Co-founder Fernando Martinelli said Balancer Labs had become more of a “liability than an asset” for the protocol, partly due to legal exposure following a November 2025 hack. The exploit, which reportedly totaled over $100 million, added to the financial strain caused by falling total value locked (TVL). TVL had already dropped from $800 million in October 2025 to around $158 million after the hack.
CEO Marcus Hardt added that the company was spending too much to attract liquidity compared with the revenue the protocol was generating. This approach also diluted BAL token holders, which he said was unsustainable.
Under the new plan, the protocol will continue on a leaner model with fewer operating costs and a smaller team. BAL emissions will be cut to zero, and revenue will flow more directly to the DAO. Members of the DAO will vote on proposals for these changes, including updates to tokenomics and treasury management.
Even under pressure, Balancer is still generating revenue, bringing in over $1 million in the past three months. The goal of the restructuring is to keep the protocol running efficiently, with a lighter cost structure, under the guidance of the DAO and the Foundation rather than Balancer Labs.
