Crypto World
Strategy expands BTC holdings despite market pullback
Strategy added more bitcoin during the latest market pullback, extending a buying pattern that has continued through recent volatility and rising geopolitical tension.
Summary
- Strategy bought 1,031 BTC at $74,326, raising its total bitcoin holdings to 762,099 BTC.
- The latest purchase was smaller than last week’s 22,337 BTC acquisition worth $1.57 billion.
- Bitcoin fell below $70,000, leaving Strategy under pressure on its latest purchase during market volatility.
Meanwhile, the company disclosed that it bought 1,031 BTC for $76.6 million, bringing its total holdings to 762,099 BTC. The latest purchase came as bitcoin traded above $74,000 early last week before falling below $70,000 after the second Federal Open Market Committee meeting of the year.
Michael Saylor’s latest update showed that Strategy completed the purchase at an average price of $74,326 per bitcoin. Based on that entry level, the transaction likely took place during the first few business days of the previous week.
The new purchase lifted Strategy’s total bitcoin holdings to 762,099 BTC. The company has now spent about $57.69 billion building its bitcoin position, keeping its status as the largest corporate holder of the asset.
The latest acquisition was much smaller than the one Strategy announced a week earlier. In that earlier update, Saylor said the company had spent $1.57 billion to acquire 22,337 BTC.
Even so, the new purchase showed that Strategy has kept its regular buying approach in place. The company continues to announce bitcoin buys on Mondays, even as markets remain sensitive to macro and geopolitical developments.
Bitcoin price swings shape market backdrop
Bitcoin traded above $74,000 by Wednesday morning last week before reversing lower. The decline deepened around and after the year’s second FOMC meeting, adding pressure to the broader crypto market.
By press time, bitcoin had fallen below $70,000 after a brief rebound to $71,500. That move followed Trump’s latest “statement” on the war in Iran, which briefly pushed prices higher before the rally faded.
Strategy’s bitcoin stack remains under pressure as the asset trades below the company’s latest average purchase price. The market correction has left the firm sitting on unrealized losses based on current spot levels.
Crypto World
South Korea Restricts Government Fuel Use While Hormuz Crisis Threatens Military and Market Stability
TLDR:
- South Korea limits government vehicles to six operating days weekly amid worsening Middle East oil supply disruptions.
- The KOSPI fell 4.9 percent Monday as the won weakened and inflation accelerated under growing fuel pressure.
- Six countries across three continents now ration fuel, marking a shift from developing to advanced economies.
- U.S. troops stationed in South Korea rely on the same disrupted Middle Eastern supply chain facing civilian restrictions.
South Korea has announced mandatory fuel rationing, restricting government vehicles from operating one day per week on a rotating license plate schedule.
The move places the world’s 10th largest economy alongside developing nations that have already imposed similar measures.
As the Strait of Hormuz remains closed, energy supply chains face mounting pressure across multiple continents.
Rationing Spreads Beyond Developing Economies
South Korea imports between 73 and 87 percent of its oil from the Middle East. Every barrel travels through the Strait of Hormuz before reaching Korean shores. With the strait closed and mined, no alternative route exists for crude imports at scale.
The KOSPI index dropped 4.9 percent on Monday before a social media post from former U.S. President Donald Trump temporarily eased market fears.
The South Korean won has also been weakening steadily. Inflation is accelerating alongside these currency pressures.
Analyst Shanaka Anslem Perera noted on social media that the rationing is “no longer a developing-world phenomenon” and is “migrating up the GDP ladder.”
Countries that have already implemented restrictions include Sri Lanka, Bangladesh, Pakistan, India, and Slovenia. Slovenia was the first EU member to introduce QR codes and odd-even plate systems.
South Korea joins that list as a G20 member and home to global semiconductor manufacturers Samsung and SK Hynix.
The country fabricates roughly a quarter of the world’s memory chips. That output now operates under the same energy strain affecting far smaller economies.
Military Readiness and Regional Stability Face Pressure
South Korea hosts 28,500 American troops across several U.S. Forces Korea bases. These operations require continuous supplies of diesel, aviation fuel, and generator capacity. Joint military exercises between U.S. and South Korean forces consume thousands of tonnes of fuel annually.
That fuel supply traces back to the same Middle Eastern supply chain now under civilian restriction. If civilian vehicles face rationing, military logistics are under comparable pressure. Reduced military logistics capacity could affect deterrence posture against North Korea along the DMZ.
Taiwan is also watching developments closely. TSMC fabrication plants in Hsinchu are reportedly counting liquefied natural gas reserves in single-digit days.
Taiwan imports nearly all of its energy, and its timeline may be shorter than South Korea’s given smaller strategic reserves.
The broader picture connects a closed maritime chokepoint to semiconductor output, military readiness, and currency stability across three continents. Sri Lanka, Bangladesh, Pakistan, India, Slovenia, and now South Korea have all imposed rationing measures.
One strait is driving policy decisions in six countries simultaneously. As Perera put it, “The molecules do not check GDP rankings. The molecules check whether the chokepoint is open.”
As the Iran war rages on, U.S. Treasury yields – the market’s gauge of borrowing costs – have surged to multi-month highs, pricing in delayed Fed rate cuts and higher inflation expectations.
The question is at what point the Treasury market, which underpins global finance, starts causing trouble for both the government and the economy, forcing the Trump administration to rethink the war or consider a mechanism to cap yields.
According to ING, that point comes when a little-known 10-year U.S. Treasury swap spread blows past 60 basis points. We are not there yet.
“Watch the 10-year swap spread. It’s just below 50bp now. If that were to shoot to 60bp, it would spell enough trouble to ultimately shape the war path. Why? It’s a measure of the de-rating of Treasuries. We need to steer clear of that. It’s not just the negative perception, it’s the added cost of funding U.S. debt,” Padhraic Garvey, CFA and regional head of research Americas at ING, said in a note to clients Friday.
Garvey emphasized that rising swap spreads aren’t just about perception; they increase the implied cost of funding for the U.S. government, making it more expensive for the heavily-indebted Uncle Sam to issue new bonds and borrow more. This could ripple through the financial system, tightening credit conditions and leading to risk aversion in both stocks and bitcoin .
“Narrow swap spreads are the good look. Wide swap spreads are the opposite,” he said.
Focus on the 10-year yield
Other observers are focused on the 10-year Treasury yield, the benchmark rate that sets borrowing costs across the U.S. economy, influencing risk-taking in both the economy and financial markets.
Since the Iran war began at the end of February, the yield has surged roughly 45 basis points to 4.37%.
According to The Kobeissi Letter, the 4.5%–4.6% range represents a critical “line in the sand.” That’s the level at which President Trump pulled back from his sweeping Liberation Day tariffs last April.
“This is in line with the rapid surge seen around ‘Liberation Day’ in April 2025. As the 10-year note yield surged above 4.50%, President Trump began floating a potential tariff pause. And, once the yield broke above 4.60%, he officially implemented a 90-day pause on reciprocal tariffs on April 9th, 2025,” the letter noted on X.
Put simply, the bond market could soon reach a point where the Trump administration feels pressured to temper the war.
On Tuesday, President Donald Trump paused attacks on Iranian infrastructure, claiming productive talks with Iran, though Iran denied having any contact. Meanwhile, early Wednesday, U.S. and Israeli forces reportedly struck new Iranian energy facilities, including a natural gas pipeline in Khorramshahr.
If the yield breaks the 4.5%–4.6% range, it could rise to 5%, the level analysts have flagged as a make-or-break point for risk assets in recent years.
According to The Kobeissi Letter, the U.S. economy cannot sustain a 5% level in the 10-year yield.
Arthur Hayes, co-founder of BitMEX and chief investment officer at Maelstrom Fund, has previously stated that a potential rise in the 10-year yield above 5% could trigger a mini-financial crisis, forcing the Fed to step in with liquidity injections.
In other words, bitcoin could initially drop in a knee-jerk reaction, but liquidity injections could quickly recharge bulls.
The takeaway is clear. bitcoin traders need to closely track Treasury yields and swap spreads, as shifts in these markets could directly influence risk appetite and policy decisions.
Crypto World
BitGo Launches MCP Server to Connect Institutional Crypto Infrastructure With AI Development Tools
TLDR:
- BitGo launched an MCP Server that connects its crypto infrastructure to AI-native development environments.
- Developers can use natural language to explore wallets, configure webhooks, and review transaction flows.
- The MCP Server supports tools like Claude Code, Cursor, VS Code, ChatGPT, and JetBrains IDEs.
- BitGo’s Developer Portal also features an Ask AI tool for direct, in-page documentation assistance.
BitGo has launched a Model Context Protocol (MCP) Server, connecting institutional crypto infrastructure to AI-native development tools.
The new capability allows developers to access BitGo’s platform resources through natural language. This move positions BitGo as an early adopter of AI-ready infrastructure in the digital asset space.
BitGo Opens Developer Resources Through Natural Language Access
The BitGo MCP Server gives developers direct access to documentation, API references, and product information. Compatible AI tools can now connect to BitGo’s Developer Portal and pull relevant context automatically. This reduces the time teams spend searching for technical guidance manually.
Developers can use natural-language prompts to explore wallet functionality and review transaction flows. They can also configure webhooks, understand staking documentation, and navigate policy features. These tasks previously required manual searches through the developer portal.
As shared on X, BitGo noted that “AI is changing how developers build,” adding that the platform is now ready for AI-native workflows. The company framed the MCP Server as a step toward making BitGo fully accessible within the AI economy.
MCP is an open standard that allows AI assistants to connect to external information sources. By adopting this standard, BitGo joins a growing list of infrastructure providers building for AI-driven development environments.
Compatible Tools and Platform Availability
The BitGo MCP Server is available now and works with several MCP-compatible clients. These include Claude Code, Claude Desktop, Cursor, ChatGPT, JetBrains IDEs, VS Code, and Windsurf. Developers can find setup instructions directly on the BitGo Developer Portal.
BitGo CEO and Co-founder Mike Belshe stated that developers can now treat BitGo as agentic infrastructure. He added that the MCP Server is only the first step in making the platform accessible to the broader AI economy.
Beyond the MCP Server, BitGo’s Developer Portal also features an Ask AI tool. This tool lets users ask questions directly within documentation pages without leaving their workflow. It offers another channel for developers to find guidance faster.
The combination of the MCP Server and the Ask AI tool reflects a broader shift in how developer platforms are evolving.
Platforms are moving toward conversational and AI-assisted access rather than traditional documentation browsing. BitGo’s approach aligns with this trend across the software development industry.
(Incentives that don’t kill your protocol long-term)
The DeFi boom brought us a tidal wave of liquidity mining programs. “Stake our token, earn our token” became the mantra, and for a while, it worked—liquidity poured in. But too often, these early experiments had a fatal flaw: they offered short-term rewards at the expense of long-term protocol health. Welcome to Liquidity Mining 2.0, where incentives are smarter, sustainable, and designed to grow both capital and community without burning the house down.
The Problem with “Free Token” Models
Early liquidity mining campaigns relied heavily on emission-driven rewards. Users were attracted by high yields, often several hundred percent APY, but there were hidden costs:
- Unsustainable inflation – New token issuance diluted existing holders, undermining token value.
- Hot money liquidity – Users chased yield without loyalty to the protocol. Once rewards dropped, liquidity evaporated.
- Governance and protocol risk – Tokens distributed too widely or too quickly sometimes gave control to opportunistic participants, not long-term stakeholders.
In short, free tokens often created a short-term spike, followed by a long-term crash.
Liquidity Mining 2.0: Principles of Sustainable Incentives
To avoid repeating past mistakes, DeFi projects are evolving their approach. Here are the core principles:
1. Reward Quality, Not Quantity
Instead of dumping tokens, protocols now reward actions that strengthen the ecosystem:
- Longer lock-up periods for stakers
- Providing liquidity to underrepresented pools
- Engaging in governance or community building
This ensures rewards are earned, not just grabbed.
2. Multi-Dimensional Incentives
Liquidity Mining 2.0 combines token rewards with non-monetary benefits:
- Exclusive governance privileges or voting power
- Access to premium features or lower fees
- Reputation systems that recognize long-term commitment
By diversifying incentives, protocols retain liquidity and encourage meaningful engagement.
3. Dynamic Emissions
Instead of a fixed APY, protocols now adjust rewards based on:
- Market conditions
- Pool health
- Token performance
Dynamic models prevent over-inflation while maintaining attractive yields for committed users.
4. Cross-Protocol Collaborations
Some projects now reward users for supporting multiple parts of the ecosystem. For example, providing liquidity on one protocol may earn rewards on another, creating network effects and reducing reliance on a single token for incentives.
5. Vesting and Lock-ups
Time-based vesting ensures that rewards are earned over the long term, reducing the likelihood of a massive sell-off right after farming.
Examples of Protocols Doing It Right
- PIVX – incentivizes masternodes and governance participation instead of high-speed token drops.
- Curve Finance – rewards users based on the stability of liquidity provided, favoring sustainable pools.
- OlympusDAO – uses bonding and staking mechanisms to align incentives with long-term treasury health.
These models show that thoughtful design can maintain high liquidity without tanking the protocol’s token economics.
Examples of Protocols Doing It Right
- PIVX – incentivizes masternodes and governance participation instead of high-speed token drops.
- Curve Finance – rewards users based on the stability of liquidity provided, favoring sustainable pools.
- OlympusDAO – uses bonding and staking mechanisms to align incentives with long-term treasury health.
These models show that thoughtful design can maintain high liquidity without tanking the protocol’s token economics.
Moving Forward
Liquidity Mining 2.0 isn’t just a tweak; it’s a mindset shift. Protocols must ask: Are we rewarding participation that grows the ecosystem, or are we just chasing TVL for short-term optics?
The next generation of DeFi projects will combine smart financial incentives with community-aligned strategies, creating ecosystems that are resilient, loyal, and sustainable.
Because in the long run, free tokens may attract wallets, but sustainable incentives attract believers.
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Stablecoin issuer Circle has urged the European Commission to lower the barrier for institutions to engage with crypto-asset service providers in response to parts of its proposed Market Integration Package — a broad policy initiative aimed at strengthening capital markets in Europe.
In a statement on Monday, Circle said the Commission’s MIP proposals represent a “meaningful step toward a digitally enabled financial system” but also outlined several areas for improvement.
Those included reforming the DLT (distributed ledger technology) Pilot Regime and scaling what the Commission describes as e-money tokens (EMTs) by permitting more crypto-asset service providers to operate. Circle said it submitted its feedback to the Commission on March 20.
The main piece of crypto legislation in Europe is the Markets in Crypto-Assets Regulation, which took effect in December 2024.
However, it has been widely criticized by some crypto lawyers, including Yuriy Brisov, partner at Digital & Analogue Partners, who argued it is difficult to interpret and that its implementation varies from country to country.
Circle said the Commission’s MIP could offer Europe-based crypto market participants more legal clarity by outlining what crypto-assets can be used as collateral.
Circle recommended lowering the barrier to entry for e-money tokens to be used in settlement by changing the market capitalization threshold under the Central Securities Depositories Regulation.
“Restricting settlement to ‘significant’ EMTs risks excluding euro-denominated EMTs” and creates a “chicken-and-egg scenario that stifles their growth,” Circle said, adding that the thresholds are a “structural barrier to institutional participation and secondary market liquidity.”
Circle seeking to expand EURC in the region
In addition to Circle’s flagship USDC (USDC) stablecoin, the company also offers a euro-backed, MiCA-compliant stablecoin, EURC (EURC), in Europe.
However, Circle noted that no euro-denominated EMT is close to reaching the market cap threshold.
Circle said the Commission should adopt more “adaptive thresholds” that are based on criteria like market uptake and liquidity conditions while conducting supervisory assessments.
Related: ECB opens digital euro work on ATMs and payment terminals
The company also said the DLT Pilot Regime, as currently proposed, restricts cash accounts to credit institutions and central securities depository financial institutions and that it should be expanded to include crypto-asset service providers.
Circle concluded that the MIP “represents a pivotal moment” for the EU to modernize its financial system and that connecting traditional finance with blockchain infrastructure through “clear and proportionate regulation” would unlock new levels of efficiency and liquidity in the region.
Magazine: Clarity Act risks repeat of Europe’s mistakes, crypto lawyer warns
Hostplus, Australia’s third-largest pension fund by member count, is reportedly considering offering cryptocurrencies as an investment option, citing interest from its members in the asset class.
“There’s certainly a demand from some of our members who write in and say, ‘Why can’t I have access to cryptocurrency?’” Sam Sicilia, the fund’s chief investment officer, told Bloomberg on Monday.
Investment offerings in crypto could be available as soon as next financial year, he said, with Bitcoin and other digital assets offered through its ChoicePlus investment option, which allows people to self-manage their retirement savings portfolio.
The plan is still in its design phase and would require regulatory approval, as well as resolution of a range of other issues, such as consumer protections before it could go live.
Hostplus is the third-largest retirement fund (known locally as a super fund) in Australia by member count and the fifth-largest by assets under management at over $96 billion ($139 billion Australian dollars), according to financial comparison site Canstar.
Australia’s total superannuation assets were estimated to be worth around $4.5 trillion Australian dollars by the end of the September 2025 quarter.
“We’d love to get regulatory tick-off, even if it means waiting another six months,” Sicilia told Bloomberg. “We are long-term investors. Six months doesn’t really move the dial for us.”
Super fund members asking for access to crypto
AMP was the first super fund to embrace crypto in May 2024, when it introduced exposure to Bitcoin via Bitcoin futures contracts as part of its investment strategy.
Sicilia told Bloomberg that crypto has evolved significantly since Hostplus first looked at the industry a decade ago.
Related: Ripple targets April for Australian financial license via acquisition
Self‑Managed Super Funds (SMSFs) are currently the main way Australians gain exposure to crypto for retirement savings. SMSFs are retirement funds set up and managed by individuals, rather than conventional funds managed by large institutions on behalf of members.
Australian crypto exchange BTC Markets reported in its Investor Study Report that SMSF registrations increased 69% year-on-year during the 2024–2025 financial year.
OKX Australia CEO Kate Cooper told Cointelegraph in February that a significant area of growth for the exchange has come from SMSF trustees, with a growing number of funds set up specifically so trustees can invest in digital assets, “because they currently can’t invest via the big super funds.”
Magazine: Banks want to run Vietnam’s crypto exchanges, Boyaa’s $70M BTC plan: Asia Express
The US Securities and Exchange Commission’s former top enforcement official reportedly clashed with the regulator’s top brass before resigning last week, with part of the reason being how the agency handled cases involving those close to US President Donald Trump.
Margaret Ryan, the ex-director of the SEC’s Division of Enforcement, wanted to pursue fraud and other charges in cases involving those in Trump’s orbit, but was resisted by SEC Chair Paul Atkins and other Republican political appointees, Reuters reported on Monday, citing people familiar with the matter.
Two cases that created tension between Ryan and the SEC’s top officials involved crypto entrepreneur Justin Sun and Tesla CEO Elon Musk, both of whom have ties to Trump, with Musk serving as a special White House adviser.
Ryan resigned from the SEC on March 16 after just over six months in her role. An SEC announcement that day did not detail the reason of her resignation.
It comes as the SEC has been under increased scrutiny from Democratic lawmakers over its U-turn on crypto-related cases, as the agency under Trump has dropped or settled multiple cases launched under former SEC chair Gary Gensler.
The SEC did not immediately respond to a request for comment. Ryan could not be reached for comment.
Sun and Musk cases a major source of tension
The SEC’s case involving Sun was reportedly among the cases that frustrated Ryan. The agency ended its lawsuit against Sun and three of his companies earlier this month with a $10 million settlement.
The SEC first sued Sun in March 2023, alleging that he and three of his companies sold unregistered securities and engaged in manipulative wash trading. The settlement saw Sun and his companies neither admit nor deny the SEC’s allegations.
Sun became the largest investor in the Trump family’s crypto project, World Liberty Financial, in November 2024 after buying $30 million worth of its tokens. He increased his stake to a total of $75 million in January 2025.
Related: SEC sends proposed crypto interpretation to White House for review
An SEC enforcement official told Reuters that the case against Sun was complicated by shifting crypto guidance and pending crypto laws. It was their understanding that Ryan supported the settlement, but her signature did not appear on court documents.
Tron, a company named in the SEC’s lawsuit, did not immediately respond to a request for comment. It has previously denied commenting on pending legal matters.
The SEC’s case against Musk, filed in the final week of Gensler’s tenure, was also a sticking point for Ryan. The SEC sued Musk in January 2025, claiming he failed to disclose that he “acquired beneficial ownership” of Twitter, now X, in early 2022, allowing him to purchase shares at lower prices.
The SEC and Musk said in a joint court filing on March 17 that they were now in talks to settle the lawsuit. Both the cases against Sun and Musk were reportedly strong and had a good chance of the SEC winning in court, according to lawyers closely following the lawsuits.
Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026
The company that built decentralized finance (DeFi) powerhouse Balancer is closing.
Balancer co-founder Fernando Martinelli announced Tuesday that Balancer Labs, the corporate entity that incubated and funded the decentralized exchange protocol, will be shutting down.
The decision comes roughly five months after a v2 exploit in November 2025 that drained approximately $110 million in digital assets, as CoinDesk first reported, including osETH, WETH, and wstETH, the third known security breach for the project and the one that created the legal exposure Martinelli cited as the reason for shutting down BLabs.
“BLabs, as a corporate entity, has become a liability rather than an asset to the protocol’s future and is just not sustainable as is without any sources of revenue,” Martinelli wrote in a governance forum post.
Martinelli added he “seriously considered” shutting everything down entirely. But he stopped short of calling for a full wind-down because the protocol still generates revenue.
Balancer was one of the defining names of the DeFi boom. At its peak in late 2021, the protocol held nearly $3.5 billion in total value locked, putting it alongside Aave, Uniswap, and Curve as foundational infrastructure for decentralized trading.
DeFiLlama data shows TVL at $2.96 billion as of October 2021, with fees spiking above $6 million annualized. But the TVL now sits at $157 million, a 95% drop from peak.
The market cap has fallen to $10 million. BAL trades at $0.16 against a fully diluted valuation of $11 million, meaning it trades far below net asset value.
Balancer produced over $1 million in annualized fees over the past three months. That’s not enough to sustain the current operation, but it’s enough to sustain a much leaner one.
The restructuring plan the remaining team is proposing is aggressive. BAL emissions would be cut to zero, ending what Martinelli described as a “circular bribe economy that costs more than it generates.”
The veBAL governance model, which he said was captured by meta-governance protocols like Aura and bribe markets that made voting “unrepresentative of the actual Balancer front line,” would be wound down.
Protocol fees would be restructured so the DAO treasury captures 100% of revenue instead of the current 17.5%. The v3 protocol share would drop to 25% to attract organic liquidity. And a BAL buyback would offer holders exit liquidity at a fair price.
“If you believe in the restructured Balancer, you stay. If you don’t, you get a fair exit,” Martinelli wrote. “That’s honest dealing, and it clears the overhang.”
Essential BLabs team members would be absorbed into Balancer OpCo pending a governance vote. Martinelli himself will have no formal relationship with the protocol after the wind-down but offered to serve as an advisor.
The product scope is narrowing to five areas where the team sees differentiation: reCLAMM pools, liquidity bootstrapping pools, stablecoin and liquid staking token pools, weighted pools, and expansion to non-EVM chains. Everything else gets cut.
BAL was trading at $0.72 as of Tuesday morning, down roughly 88% from its all-time high.
Balancer Labs, the corporate backbone behind the Balancer DeFi protocol, is winding down after years of pressure and a devastating $116 million hack in November. Executives say the move is aimed at preserving the protocol’s long-term viability by shifting control to leaner, cost-efficient governance structures rather than preserving a non-revenue-bearing entity.
In a message from Balancer Protocol co-founders, Fernando Martinelli and Marcus Hardt, the plan is clear: Balancer Labs has become a liability rather than an asset to the protocol, and continuing its operations under the current model is unsustainable. “After careful consideration, I have decided to wind down Balancer Labs. This is not a decision I take lightly,” Martinelli wrote, underscoring that the corporate entity has been absorbing liabilities tied to past incidents without delivering commensurate value.
Hardt echoed the sentiment, acknowledging that the pace of liquidity acquisition came at a cost, diluting Balancer token holders (BAL) in the process. The team is proposing a pivot toward a lean continuation path, with governance moving to a Balancer Foundation and the protocol’s decentralized autonomous organization (DAO) framework. In their view, reducing operating costs and reconfiguring revenue capture could unlock more sustainable upside for the community and BAL holders.
Balancer’s journey from its heyday to today is a cautionary tale for DeFi protocols: a combination of ecosystem stress, security breaches, and shifting incentives can erode value even for blue-chip protocols. Balancer was among the prominent DeFi players during the 2020–2021 bull market, reaching a peak TVL of about $3.3 billion in November 2021. However, the landscape shifted dramatically in the following years, and Balancer’s total value locked has since deteriorated. By October 2025, Balancer’s TVL sat around $800 million, and after the November hack, another roughly $500 million exited within two weeks. Today, Balancer’s TVL is reported near $158 million, illustrating how difficult it remains for DeFi protocols to recover from major security incidents and reputational shocks.
Martinelli argued that the November exploit created real and ongoing legal exposure, making the burden of maintaining a corporate entity that carries the liability of past security incidents untenable. The practical implication is a shift of authority and responsibility away from a centralized corporate structure toward community-led governance that can react more nimbly to risk and opportunity.
Key takeaways
- Wind-down of Balancer Labs and shift to DAO governance: The Balancer Foundation and the protocol’s DAO would assume primary responsibility, moving away from the operating model of Balancer Labs.
- Debt, risk, and historical shocks as core drivers: A $116 million hack in November and ongoing legal exposure have pushed leadership to pursue a leaner, more cost-conscious structure.
- TVL deterioration since the 2021 peak: From a 2021 high of $3.3B to roughly $158M today, with a $500M drop in the two weeks following the November exploit, underscoring the fragility of DeFi liquidity post-crisis.
- Tokenomics under review: Two Balancer proposals are on the table—operational restructuring and a revamp of BAL tokenomics—to empower the DAO to capture revenue and align incentives.
- Revenue signal amid restructuring: Balancer reportedly generated just over $1 million in revenue across the past three months, suggesting real activity exists beneath a challenging economic overlay.
Strategic pivot: from corporate entity to governance-led continuity
The core strategic question facing Balancer is how to preserve the protocol’s value proposition—composability, liquidity pools, and automated market-making—while severing the liabilities associated with the old corporate structure. Martinelli’s framing centers on transforming Balancer’s future into a governance-driven enterprise. By transferring stewardship to the Balancer Foundation and the DAO, the project aims to unlock a more disciplined cost base and ensure that incentives align with long-term sustainability rather than short-term liquidity subsidies.
Hardt’s commentary reinforces this stance. He cautioned that the push to attract liquidity had grown disproportionately expensive relative to the revenue Balancer generated, a dynamic that ultimately diluted BAL holders. The proposed path forward emphasizes cost containment, lower operating expenses, and a revenue model that better channels yields to the DAO’s treasury and governance processes rather than a centralized corporate structure.
Economic realities and what changes on the ground?
The historical context matters for readers trying to gauge what “lean continuation” means in practice. Balancer’s ascendancy in 2020–2021 rested on robust liquidity and diversified pools, but the market eventually exposed fragilities in governance and tokenomics when external shocks hit. The November hack—paired with the legal exposure Martinelli cites—highlights a broader risk for DeFi firms that relied on centralized entities for continuity even as the core protocol operates in a decentralized manner.
Under the proposed framework, the Balancer Foundation would assume operational stewardship, while the DAO would govern protocol parameters through member-driven decisions. The two ballot items circulating among Balancer DAO members reflect the proposed reorganization: one addressing operational restructuring and the other focused on a tokenomics revamp for BAL. Although no exact timelines were provided, the proposals mark a formal step in transitioning from a traditional corporate governance model to a decentralized, community-led structure that could potentially reclaim incentives for users, liquidity providers, and token holders alike.
Despite the restructuring narrative, leadership remains focused on validating the protocol’s underlying utility. Martinelli stated that Balancer “still has real value to build from here.” He emphasized that the challenge lies not in the functionality of Balancer itself but in the economics surrounding the token and the cost structure that has weighed on the ecosystem. “That’s not nothing — that’s a functioning protocol buried under a broken tokenomics model and an overweight cost structure,” he noted, underscoring the possibility that a well-executed governance and tokenomics revamp could recalibrate Balancer’s market position without requiring a complete rebuild.
In a more forward-looking frame, Hardt reiterated optimism about a transition that could yield a stronger, more sustainable protocol on the other side. “Balancer still has real value to build from here. If we can make this transition work, we have a real chance to build a stronger and more sustainable protocol on the other side of it,” he said, signaling that the venture’s potential remains intact if governance and economics align with community incentives.
Implications for BAL holders and the broader DeFi community
For BAL holders, the shift toward DAO governance and a leaner mechanism for revenue capture represents both risk and potential upside. The current tokenomics, which critics have described as misaligned with the protocol’s growth trajectory, could be redesigned to better reward active participation, liquidity provision, and governance involvement. If the two ballot proposals gain traction, the resulting changes could recalibrate how BAL accrues value, potentially restoring confidence among participants who have watched the token’s price and utility drift amid structural changes.
From a broader industry perspective, Balancer’s move illustrates a growing trend: large DeFi protocols rethinking corporate versus community governance as they navigate liquidity headwinds and the consequences of security incidents. The tension between preserving a functioning, revenue-generating protocol and maintaining an agile, decentralized structure remains central to these debates. In practice, the governance pathway could become a litmus test for how effectively a DAO can steward a sophisticated liquidity protocol through a period of stress without sacrificing security or user trust.
Investors and builders should monitor how the Balancer Foundation and DAO approach risk, security, and revenue generation in the coming months. The balance between cost discipline, user incentives, and governance empowerment will likely shape Balancer’s ability to attract new liquidity, preserve its core utility, and demonstrate a model for other protocols facing similar crossroads.
Historically, Balancer’s story contains a recurring theme: the technology can be sound, but economics and governance determine whether a protocol can endure. The forthcoming ballots and any subsequent actions will reveal whether this is a pivot toward vitality or a transition toward obsolescence.
As the community awaits the outcome, readers should note that the questions are less about whether Balancer’s code works and more about whether the economics and governance can be aligned to sustain meaningful activity, liquidity, and value creation in a shifting DeFi landscape.
What remains uncertain is the timeline for the governance transition and the exact design details of the proposed tokenomics revamp. Yet the intent is clear: reframe Balancer as a lean, community-led platform that can endure beyond the current corporate-era constraints and deliver durable value to users and stakeholders alike.
In the coming weeks, observers will want to track the ballot results and any subsequent updates from the Balancer Foundation and DAO, as these will signal the protocol’s willingness to embrace this new governance paradigm and the potential trajectory for BAL’s future utility and distribution of value within the ecosystem.
Bitmine Immersion Technologies chairman Tom Lee has tipped an end to the “mini-crypto winter” impacting Ether, as the company bought another $139 million in ETH last week, bringing it closer to its goal of hitting 5% of the token’s total supply.
Lee said in a statement on Monday that Bitmine has maintained a higher buying pace over the last three weeks as it expects the end to a several-month-long Ether slump in its “base case.”
The crypto markets crashed in October last year, with Bitcoin (BTC) falling from its all-time peak above $126,000 during the month, while Ether declined from its August high of $4,946. Analysts have been debating when the crypto markets will see a meaningful rebound.
Lee pointed to positive catalysts, such as the CLARITY Act advancing in Congress and crypto’s relative stability despite recent turmoil in Iran, as signs that winter is starting to thaw.
“As many have noticed, crypto and particularly ETH have outperformed the broader market since the Iran war commenced, with ETH rising 18% and outperforming equities by 2,450 basis points,” he said.
“This is a marked contrast to Gold, a traditional store of value, which has fallen more than 15%. Crypto is demonstrating itself to be a good ‘wartime’ store of value,” Lee added.
Lee’s statements came as Bitmine disclosed it had purchased an additional 65,341 Ether in the past week (worth $139 million), bringing total holdings to more than 4.6 million tokens.
Bitmine nears Ether accumulation goal
Bitmine has stockpiled roughly 3.86% of the total circulating supply of 120.6 million since announcing its crypto pivot eight months ago.
To reach its goal based on the current total supply, the company will need to buy roughly 1.4 million tokens, which, at current prices, would cost roughly $2.9 billion, according to CoinGecko.
Ether does not have a fixed supply; it can increase or decrease based on whether more is burned than issued.
Related: Early Ethereum whale rebuilds stack with $19.5M in ETH buys
The firm has also leaned heavily into staking, with more than three million of its Ether currently staked.
Bitmine also reported other holdings, including $1.1 billion in cash, 196 Bitcoin, a $200 million stake in Beast Industries, a media company founded by YouTuber Jimmy “MrBeast” Donaldson and a $95 million stake in e-commerce inventory management platform Eightco Holdings.
A flood of companies pivoted to crypto in 2025, with Bitmine rising to the second-largest behind Michael Saylor’s Strategy in terms of holdings. However, some, like the multinational bank Standard Chartered, predict that not all will survive in the long term, which may force them to adopt new strategies or fade away.
StrategicEthReserve is currently tracking 67 large treasury holders of Ether, with Bitmine leading by a large margin. SharpLink Gaming, which held the top spot before being surpassed by Bitmine, is second with 863,000 Ether, while Ether Machine ranks third with 496,000 tokens.
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