Svmuu News Balancer co-founder Fernando Martinelli announced in a governance forum post that, after careful consideration, the decision has been made to shut down Balancer Labs. He pointed out that the v2 vulnerability attack on November 3, 2025, has created ongoing legal risks. Maintaining a corporate entity that bears responsibility for past security incidents is detrimental to the protocol's future development, and this entity is no longer sustainable without a revenue source. Core team members from Balancer Labs will be integrated into Balancer OpCo, pending approval through a governance vote.
Fernando Martinelli stated that over the past three months, the Balancer protocol's annualized total fee revenue has exceeded $1 million, and the protocol itself is still operational. The issue lies with the economic model surrounding the protocol and its excessively high cost structure. He supports the ongoing proposal for tokenomics restructuring, which includes reducing BAL emissions to zero, shutting down the veBAL system, directing 100% of protocol fees to the DAO treasury, lowering the V3 protocol fee split to 25% to attract liquidity, and providing exit liquidity for holders through BAL buybacks.
On the product side, the focus will be on reCLAMM, LBP, stablecoin and LST pools, and weighted pools, while reducing deployments on low-value chains. Fernando Martinelli indicated that after the closure of Balancer Labs, he will no longer maintain a formal relationship with the protocol but is willing to continue providing support in an advisory capacity.