# BALANCER FORUM RFC: \[RFC\] Preventing $6M+ Treasury Dilution: Implementing a Merkle-Guard for BIP-928

**URL:** <https://forum.balancer.fi/t/balancer-forum-rfc-rfc-preventing-6m-treasury-dilution-implementing-a-merkle-guard-for-bip-928/7119>\
**Category:** Karpatkey Updates\
**Created:** [September 26, 2026, 5:09pm UTC](https://forum.balancer.fi/t/balancer-forum-rfc-rfc-preventing-6m-treasury-dilution-implementing-a-merkle-guard-for-bip-928/7119 "2026-09-26T17:09:15Z")\
**Posts on this page:** 1\
**Page:** 1

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**Author:** ![jaysmith83912](https://avatars.discourse-cdn.com/v4/letter/j/a5b964/32.png) [@jaysmith83912](https://forum.balancer.fi/u/jaysmith83912)\
**Post date:** [September 26, 2026, 5:09pm UTC](https://forum.balancer.fi/t/balancer-forum-rfc-rfc-preventing-6m-treasury-dilution-implementing-a-merkle-guard-for-bip-928/7119/1 "2026-09-26T17:09:15Z")

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BALANCER FORUM RFC: [RFC] Preventing $6M+ Treasury Dilution: Implementing a Merkle-Guard for BIP-928

\*\*To the Balancer Treasury Council & Stakeholders:\*\*

I am submitting a formal Technical Audit and Proposal to address a critical structural vulnerability in the current BIP-928 wind-down logic.

## 1. THE LEAKAGE QUANTIFIED

Using a custom on-chain analysis engine, we have identified a significant \*\*‘Ghost-Liquidity’\*\* vector. High-velocity whales (Sample: `0x4E9A9483BDfC66b83FF248754EF2f7035c78aeF7` and `0xfF052381092420B7F24cc97FDEd9C0c17b2cbbB9`) currently hold \*\*2.43 Million BAL\*\*, valued at \*\*$6.09M USD\*\*, while showing active on-chain history consistent with early migration patterns.

## 2. THE RISK

Without a cryptographic ‘Legacy Lock,’ these entities are economically incentivized to claim both the MAXYZ fork value AND the BIP-928 treasury stables. This creates a \*\*Migration Subsidy\*\* paid for by loyal, non-migrating LPs, diluting the treasury NAV by an estimated 10-15%.

## 3. THE SOLUTION: REDEMPTION INTEGRITY GUARD (RIG)

We propose the implementation of a Merkle-based validation layer for the redemption contract.  
\* \*\*Merkle-Lock:\*\* Eligibility is strictly tied to a pre-BIP-929 snapshot block.  
\* \*\*Blacklist Capability:\*\* Governance retains the ability to exclude addresses that have accepted airdrops from the fork.

## 4. REQUEST

We are requesting a \*\*$25,000 Technical Integrity Grant\*\* (payable in stables or BAL) to finalize the snapshot state, manage the RIG contract deployment, and ensure 100% distribution integrity.

\*\*Technical Artifacts:\*\*  
\* \*\*Proposed Contract Logic:\*\* [INSERT\_YOUR\_GIST\_LINK\_HERE]