Difference between revisions of "Balancer"

Balancer adopts powerful features to slash gas costs, super-charge capital efficiency, unlock arbitrage with zero-token starting capital, and open the door to custom AMMs.

There are two categories of users who can benefit from the Balancer Protocol:  

There are three main categories: "Retail" traders seeking to exchange tokens with low slippage at favorable rates. Arbitrageurs seeking profit through leveling market inefficiencies between DEXs or CEXs. Ethereum smart contracts seeking liquidity for a variety of reasons, such as liquidating positions on other protocols, trading on behalf of users, etc.

Yes, Balancer Governance Token, BAL, can be used to vote on proposals and steer the direction of the protocol. Every week 145,000 BALs, or approximately 7.5M per year, are distributed to liquidity providers. They are typically distributed directly to liquidity providers on Tuesdays at 2300 UTC.

5M were allocated for the Fundraising Fund. Balancer Labs raised a pre-seed and seed round. This fund will be used for future fundraising rounds to support Balancer Labs' operations and growth. BAL tokens will never be sold to retail investors. The remaining 65M tokens are intended to be mostly distributed to liquidity providers in the coming years.

-Protocol Vault for all Balancer pool assets

-Community-governed protocol fees

Balancer V2 consolidates each pool’s assets in the Vault, which holds the assets for all Balancer pools. Even though trades can be carried out in batches against multiple pools, only the final net token amounts are transferred from and to the vault, saving a significant amount of gas in the process. While previous multi-hop trades would have required as many token transfers as hops, the Vault simplifies the trade by only transferring the input and final output tokens; all other swaps are performed by adjusting pool balances within the Vault.

Trading fees: A small percentage of the trade paid by traders to pool LPs, set by the pool creator or dynamically optimized by Gauntlet. Additionally, Balancer governance can vote to introduce a Protocol Trading Fee, which is a percentage of the Trading Fee.

Note: All protocol fees were set to zero at launch, and in Dec 2021, were set to 10% by a governance vote.

The core tenets of Balancer V2 are security, flexibility, capital efficiency and gas efficiency.

''Flexible'' — Balancer welcomes other teams to innovate on top of V2, creating a thriving ecosystem and network effect. Grants and bounties will be given to contributors who create new successful pools.

Balancer is deployed on Ethereum, Polygon, and Arbitrum. It's also deployed to the Kovan, Goerli, and Ropsten testnets.

There are no implementations on Tron, or any other networks. Balancer Labs has awarded grants to teams developing on Near and Algorand; however, these are exploratory grants, and does not imply that there are working versions of Balancer Protocol on these systems.

The team behind the Balancer Protocol (Balancer Labs) has been in the DeFi space for a while, and started Balancer as a research project in early 2018.

Currently there are ~30 Balancer Labs employees, consisting of developers, integrations, marketing, business development, and more.