Balancer, an esteemed decentralized-finance (DeFi) protocol with significant liquidity under management, suffered an estimated $128 million hack despite 11 independent audits of its smart contract code. Read about what happened on CryptoSlate +2 or DL News +2.
PeckShield reported on 3 November 2025 a coordinated attack across multiple chains against Balancer v2 “Vaults”. Defiant reported they are part of their attack team.
Losses were estimated at about $100 million from Ethereum deployment and additional losses resulting from forked deployments on Berachain, Arbitrum, and Base networks. According to CryptoSlate.
Initial forensic analysis suggests the attacker manipulated Balancer’s price-calculation logic and “invariant” rules within Vault architecture, to facilitate liquidity drain via composable pools and swap functions.
CryptoSlate
Why audits didn’t stop this hack
Balancer’s v2 smart contracts had been audited multiple times by major firms like OpenZeppelin, Trail of Bits and Certora but their exploit still worked successfully, according to DL News and experts cited herein. They believe this proves the following points:
Audits may detect known patterns and vulnerabilities, but cannot guarantee against novel or subtle logical flaws. We offer CryptoSlate audit services as an additional safeguard.
Complex, composable DeFi architectures – where one smart contract relies upon or interacts with others – increase risk, as was witnessed with Balancer Vaults being exploited across chains. Bankless.com also identified risks in such structures.
As blockchain researcher Suhail Kakar noted, audited by X doesn’t mean much anymore; thus broadening repercussions for DeFi.
The Balancer exploit has several important ramifications.
Erosion of Trust. Although Balancer was considered relatively secure, this incident shows that even well-established protocols remain vulnerable.
The Defiant.
Systemic risk. Due to Balancer being integrated across chains and having many forks, its impact was rippled throughout some networks causing operations to stop in response.
Audit fatigue. Multiple audits may create a false sense of security; what matters increasingly are real-time detection mechanisms and robust governance frameworks.
AInvest is strengthening calls for regulation as DeFi matures and loss magnitudes increase, regulators may intensify scrutiny of protocols with large assets under management. CrytpSlate What lies in wait for Balancer and DeFi?
Balancer has confirmed the exploit, suspended affected v2 pools and initiated an investigation. Yahoo Finance wants its participants to stay alert for:
Balancer conducted an exhaustive postmortem to identify root causes and provide solutions.
Changes to risk management practices, such as insurance coverage, protection for liquidity providers and fallback mechanisms.
Institutional investors could reassess exposure to protocols they perceive as riskier, leading to market shifts.
Further technological innovation includes formal verification, cross-chain risk controls and improved composability safeguards.
Conclusion
Balancer’s $128 million hack was more than just another headline – it marked a turning point in DeFi. It proved that even protocols with numerous audits, good reputations and widespread integration can still be vulnerable to sophisticated attackers; thus demonstrating why as DeFi evolves its focus should shift from “we are audited” to “we are resilient”. Balancer exploit reshaped the risk parameters associated with decentralized finance — all participants now taking note.
