It is almost a standard pattern that cannot withstand a bear market—once the DeFi king, Balancer announced the closure of its physical entity. This is not just the departure of an ordinary project, but the curtain call of a generation of giants.
📉 The TVL plummeted dramatically
Once, Balancer had a real TVL of up to 3.3 billion dollars. However, after the hacking incident in November last year, funds fled rapidly, and now the remaining TVL is less than 200 million dollars.
💰 Did not make money? Actually, it’s not true
What is most lamentable is that the protocol itself did not 'lose money'. In just 3 months after the urgent patching of the vulnerabilities, Balancer still generated 1 million dollars in trading fees.
So, why still close up?
⚠️ Core issue: Token $BAL has no holding value
This is not a question of whether the protocol makes money, but rather a question of the underlying logic being ruthlessly exposed under the collapse of prices in a bear market. The token BAL lacks value that encourages users to 'hold long-term'.
If a protocol issues tokens, but the first thought users have when they receive them is simply to 'sell', then what use does this protocol's token have?
Let's return to the essence of cryptocurrency: The value of the crypto circle is originally built on this decentralized ledger and consensus.
Imagine if today everyone got $BTC or $ETH , and everyone just wants to sell it immediately for stablecoins, where is the value base of the crypto circle?
💔 It's not bankruptcy, but rather 'disheartenment'.
Rather than saying Balancer is shutting down, it would be more accurate to say the team is feeling disheartened. This indicates that the 'economic model' they designed in the past cannot operate in the current market environment.
However, Balancer has not completely died; instead, it has chosen another form of 'letting go' and 'exiting':
Retaining protocol operation: The code is still there, and the spirit of DeFi remains.
Returning rights to the community: 100% of future protocol revenue will go to the DAO.
Lowering the threshold: The commission for the V3 protocol will be reduced to stimulate liquidity.
Feedback mechanism: Officially launching the token buyback plan.
If you are a loyal supporter of this protocol, you can still choose to stay and continue moving forward with the DAO;
But for developers in reality, this is undoubtedly a short-term exit, officially marking the end of this generation of DeFi giants.
The chill of the bear market still lingers; when will the next DeFi innovation truly solve the 'holding value of tokens'?