Balancer Fork Proposal Could Reduce Tokenholder Redemption Value
A new fork proposal enters the debate
MAXYZ, a group of former Balancer contributors, has requested up to 6 million BAL tokens to launch a successor protocol. This request comes while Balancer is considering a plan to wind down its operations and distribute remaining assets to token holders. The core concern is that if these new tokens become eligible for redemption before a specific deadline, the total treasury would be split among more tokens, lowering the payout for existing holders.
How the numbers could shift
- MAXYZ proposes taking 3.5 million BAL from the DAO treasury, plus funds from two Balancer Labs safes.
- If 3 million additional tokens become redeemable, the estimated payout per token drops from $0.1579 to $0.1507.
- If all 6 million requested tokens become eligible, the payout could fall to $0.1442, a decrease of roughly 8.7%.
- The proposed return to the Balancer treasury is a conditional promise of 10% of the fork's future token supply, which has no current value.
Details from the forum proposals
The proposal was posted on the Balancer forum on September 20 and updated with a FAQ on September 23. It runs parallel to a separate "wind-down" plan that allows holders to burn their tokens for a share of the DAO's assets. Neither proposal automatically transfers tokens or changes operations; both require separate votes. The wind-down plan sets a snapshot for eligible tokens at the end of May 2027. Any BAL granted to the fork that enters circulation before this snapshot could increase the total number of redeemable tokens.
According to an unaudited on-chain measurement from September 18, the Balancer DAO held approximately $9.96 million in non-BAL assets. With about 63 million BAL considered redeemable at that time, the value stood at roughly $0.1579 per token. These figures are estimates based on specific dates and do not guarantee future payouts, as the final asset count will be determined at an audited snapshot.
Unresolved questions on funding and rights
The proposal includes several unconfirmed elements. MAXYZ suggests that 10% of the fork's future token supply would go to the Balancer treasury if a liquidity event occurs, but this is a conditional right with no guaranteed outcome. Additionally, the plan asks for a perpetual license to Balancer's intellectual property. It remains unclear who has the authority to transfer assets from the Balancer Labs safes mentioned in the request, as these are held by legal entities separate from the DAO.
Operational timelines also differ between groups. Under the amended wind-down plan, certain pools would pause for withdrawals by October 30, though extensions are possible until November 30. MAXYZ argues that pools should remain active until mid-2027 to allow partners time to migrate. They estimate operating costs at $5,000 per month, which they claim could be covered by revenue or a reserved fund, though this budget has not yet been approved.
What remains uncertain
It is not yet known how many of the requested 6 million BAL tokens will actually enter the pool of redeemable tokens before the May 2027 snapshot. The final impact on holder value depends on whether the grant is approved, how quickly the tokens circulate, and the exact asset valuation at the time of the audit. Furthermore, the relationship between the fork's future success and the compensation offered to the original DAO remains speculative.
Next steps for the community
Separate votes will be required to decide on the token grant, the technology licensing, and the specific timeline for the wind-down. The community must also determine the ownership of code and licenses before any transfers can occur. Until these decisions are made, the final distribution amount for token holders remains subject to change based on the outcome of these proposals.
Where this information comes from
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