Balancer community details $8M recovered funds distribution plan
Two members of the Balancer protocol community submitted a proposal on Thursday outlining how approximately $8 million recovered from the protocol’s $116 million November exploit would be distributed to affected users.
Roughly $28 million of the $116 million was recovered by white hat participants, internal rescue efforts, and StakeWise, an Ether liquid staking platform. The proposal applies only to the $8 million retrieved by white hats and internal rescuers. The nearly $20 million recovered by StakeWise will be handled separately and distributed to its users, according to the plan .
The authors recommend non-socialized reimbursements, meaning funds would be returned only to the specific liquidity pools that incurred losses, with payouts made on a pro-rata basis aligned with each holder’s share of the pool, as represented by Balancer Pool Tokens (BPT) .
Compensation would be paid in-kind, with recipients receiving the same tokens they lost during the incident to minimize pricing discrepancies across different assets, according to the proposal.
Deddy Lavid, CEO of blockchain cybersecurity firm Cyvers, described the Balancer breach as one of the “most sophisticated” attacks in 2025, citing the evolving nature of security threats in the sector.
Balancer smart contracts underwent multiple audits prior to the breach
According to the project’s GitHub repository, Balancer’s code was audited 11 times by four separate blockchain security companies.
Despite these reviews, the platform was compromised, prompting questions among some users about the extent to which audits can guarantee code safety.
In a post-mortem published on Nov. 5, Balancer identified the root cause as a sophisticated exploit of a rounding function used in EXACT_OUT swaps within its Stable Pools.
The function is intended to round down when token prices are input, but the attacker manipulated the computation so that values were rounded up instead.
The attacker combined this vulnerability with a batched swap — a single transaction executing multiple steps — to extract funds from Balancer’s pools. From an external perspective, it raises a challenging question about how can these platforms ensure their code safety despite being reviewed multiple times.
Yet, despite these setbacks, Balancer continues to be a leading name in the blockchain world, persevering through challenges and learning from its past experiences.
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