Balancing Labs will gradually shut down, and the protocol will shift to DAO and foundation mode operation

Fernando Martinelli, co-founder of Balancing, announced that due to a lack of revenue sources and legal risks posed by the v2 exploit incident in November 2025, Balancing Labs will gradually shut down. The core team members are planned to be taken over by Balancing OpCo, and related proposals will be submitted for governance voting. Martinelli stated that the agreement no longer requires the support of traditional corporate entities and will be operated by DAO, foundation, and service provider models in the future. Although the annualized total cost of the agreement has exceeded $1 million in the past three months, the economic model is unsustainable and the cost structure is too heavy. Martinelli supports the token economy restructuring plan and operational proposal, including stopping BAL emissions, ending the veBAL mechanism, fully routing protocol fees to DAO treasury, repurchasing BAL to provide liquidity exit, and focusing on core product lines. Martinelli will no longer maintain a formal relationship with the agreement and hopes to provide support as an advisor.