Woofun AI reports that Anton Bukov, co-founder of the decentralized trading aggregation protocol 1INCH, has exited the organization’s operational framework to establish a new venture named Second Tier. This departure marks a definitive fracture in the leadership structure of one of DeFi’s most prominent aggregators, driven by irreconcilable differences regarding the strategic direction and governance philosophy of the platform. The announcement signals not merely a personnel change but a fundamental ideological split between the original architectural vision of the protocol and its current execution path under new management.

The timeline of this separation reveals a prolonged period of internal friction before the public announcement on July 16. Bukov’s active involvement in the company’s daily operations ceased at the end of November 2025, following disagreements over strategic priorities and leadership approaches. During his tenure, Bukov was the primary architect behind critical infrastructure components, including the 1inch Router, the Fusion exchange mechanism, and the cross-chain Swap functionality. Despite stepping back from operational duties, he retained his title as co-founder and holds 50% of the shares in the entity. The public statement issued on July 16 served to formalize this transition and simultaneously introduce Second Tier, a new project intended to explore alternative financial infrastructure models.

Second Tier, accessible via tier.xyz, is positioned not as a direct competitor to existing decentralized exchanges (DEXs) or aggregators, but as an infrastructure company aimed at "reducing the gap between economic intentions and on-chain execution." The philosophical underpinning of the project argues that current financial frictions—such as intermediaries, settlement delays, and licensing requirements—are artificially imposed constraints. Rather than optimizing within these existing frameworks, which Bukov describes as a mere "trade-off," Second Tier seeks to operate on a "second tier" where these constraints can be fundamentally redesigned. The goal is to build entirely new categories of financial architecture rather than competing within established ones, though no specific product formats or technical architectures have been disclosed.

In an interview with The Defiant, Bukov clarified the current status of Second Tier, confirming that the project has no public funding, no disclosed team members, and will not reveal product details until a functional system is available. He explicitly stated that Second Tier is not a DEX or aggregator and is not intended to compete with 1INCH. The only information currently available is the initial statement published on tier.xyz, which outlines the vision without specifying a release timeline or technical stack. This opaque approach suggests a focus on conceptual development before public engagement, leaving the market to speculate on the tangible output of the new venture.

The nature of Bukov’s departure remains a point of contention, with conflicting narratives emerging from both sides. Bukov asserts that he was fired by 1INCH at the end of November 2025 after months of attempting to influence the company’s leadership style and communication methods. He characterized the split as a typical separation among mature founders, stemming from divergent views on strategic direction and operational culture. Conversely, 1INCH disputes the claim of being "fired," arguing that Bukov was not a direct employee and therefore could not be legally terminated. The company maintains that his contributions to architecture and security were part of a collaborative team effort, with other individuals assuming responsibility for those areas. Officially, 1INCH confirmed that Bukov has not been involved in any protocol activities since December 2025, asserting that the operation remains unaffected.

This leadership clash occurred against the backdrop of 1INCH’s accelerated pivot toward traditional finance (TradFi) in the second half of 2025. In October 2025, CEO Sergej Kunz repositioned the brand, articulating a vision to expand into all financial markets. This strategic shift was underscored by the integration of 1INCH’s swap engine into the Coinbase App, marking its largest client partnership in the U.S. market. The target demographic began shifting from native DeFi users to institutional and traditional finance participants.

Bukov, however, held a contrary view, emphasizing his belief in DeFi as the path to an open, frictionless financial system without intermediaries. He stated, "I’d rather build it myself than wait idly," highlighting his preference for maintaining the decentralized ethos he originally championed. In mid-November 2025, he was still advocating for the developer version of the shared liquidity protocol Aqua, only to be asked to leave weeks later.

The timing of Bukov’s exit coincides with a significant contraction in 1INCH’s business metrics, as detailed in the State of 1inch Q1 2026 report released by Messari on May 22. Data compiled by Woofun AI shows that 1INCH’s average daily trading volume plummeted from $244.9 million in Q4 2025 to $97.1 million in Q1 2026, representing a quarterly decrease of 60.3%. This decline is starkly higher than the industry average, as the entire DEX aggregation sector saw its average daily trading volume drop from $4.6 billion to $2.7 billion, a decline of approximately 40%. The disparity suggests that 1INCH is underperforming relative to its peers, potentially indicating deeper structural issues exacerbated by the leadership transition.

Market share data further illustrates 1INCH’s weakening position. On the networks where it operates, 1INCH’s share fell from 25.2% in Q4 to 17.0% in Q1, dropping from first place to fourth. It now trails behind Kyber (23.9%), CoWSwap (18.0%), and ZeroEx (17.9%). Despite this overall decline, certain segments show resilience. The collaboration between 1INCH and Ondo Finance routed over $2.5 billion in cumulative trading volume of tokenized stocks and ETFs on BNB Chain.

Additionally, the Limit Order Protocol on BNB Chain saw its average daily trading volume increase by 52.7%, making it the only network to exhibit growth. The Fusion protocol also performed relatively better, with its average daily trading volume declining by only 26.5%, compared to the 60.3% drop in aggregation protocols.

Notably, the average number of orders per day for Fusion increased by 31.3%, rising from 13,200 to 17,300, indicating a user shift toward smaller, more frequent transactions.

The market reaction to Bukov’s departure was muted, with the 1INCH token experiencing a decline of only about 1% within 24 hours of the news breaking. Sergej Kunz emphasized that the departure does not affect the infrastructure or system operations of the 1INCH network.

However, the unresolved questions surrounding the future of both entities remain significant. Bukov retains 50% of 1INCH’s shares and his co-founder title but has no operational say, with no indicated plans to sell or take shareholder action. Second Tier remains in a conceptual stage, lacking a product, funding, or public team. It remains to be seen whether 1INCH’s strategy toward institutionalization can reverse the ongoing decline in trading volume, or if the ideological rift will continue to impact the protocol’s competitive standing in the evolving DeFi landscape.