Balancer, the automated market maker protocol whose corporate entity shut down six months ago, has published a governance proposal to wind down the protocol entirely and return at least $9 million in treasury assets to BAL token holders.

Marcus Hardt, a treasury council member and former Balancer Labs chief executive, published the proposal on Sept. 14. The plan calls for halting all new business activity, sunsetting the protocol in phases, and dissolving the decentralized autonomous organization to the extent possible under applicable law.

Treasury distribution mechanics

Under the proposal, a previously approved BAL buyback program would be canceled. In its place, remaining treasury assets would be distributed proportionally to BAL holders who voluntarily burn their tokens. The treasury holds at least $9 million in tokens, according to the proposal.

Additional DAO wallets and positions would be consolidated into a single inventory and folded into the first redemption round. BAL held by the treasury itself would be excluded from the distribution, with a narrow carve-out for holders of tetuBAL, a liquid staking wrapper token.

Hardt acknowledged that the protocol had attempted a turnaround. Token holders approved a restructuring plan in April aimed at cutting costs, ending token emissions, simplifying the token model, and routing protocol revenue back to the DAO. While certain new initiatives showed early signs of traction, Hardt wrote, none produced sustained revenue growth.

A phased exit running into 2027

If token holders approve the proposal in a snapshot vote scheduled for Sept. 25 through Sept. 29, the wind-down would begin quickly. Contributor notice periods would run through Oct. 31, and all pools would shift to withdrawals-only mode on Oct. 30. Balancer has confirmed that nothing in the protocol will change until after the vote concludes.

The first redemption window would open at the end of May 2027 and remain open for six months. During that period, BAL holders could burn their tokens in exchange for a proportional share of the treasury. A second distribution would follow within two months of that window's close, covering unspent wind-down funds, late receipts, and any shares that went unclaimed. A final sweep six months later would distribute whatever remained.

Aftermath of the November exploit

The proposal follows a turbulent period for the protocol. On Nov. 3, 2025, an exploit drained approximately $128 million from Balancer v2 pools across multiple chains. The breach precipitated Balancer Labs' decision to cease operations earlier this year, leaving the DAO and its treasury council to manage the protocol's remaining affairs.

The wind-down proposal, if approved, would mark one of the most consequential controlled shutdowns of a major DeFi protocol to date, converting treasury assets into direct holder redemptions rather than continuing emissions-based operations.

For BAL holders and liquidity providers, the operational implications are immediate. Liquidity providers face a firm deadline of Oct. 30, when pools become withdrawals-only, to reposition assets without relying on active trading infrastructure. Token holders must then decide whether to participate in the 2027 burn-and-redeem mechanism or retain BAL with diminished protocol backing.

The snapshot vote opens Sept. 25 and closes Sept. 29, giving the DAO's token holders less than two weeks to decide the protocol's final trajectory.