Balancer

Balancer is a DeFi platform with two main products; automated portfolio manager, and a decentralized exchange (DEX).

What is Balancer? 

  • Balancer’s automated portfolio manager is a DeFi product that connects arbitrage traders with investors in a decentralized mechanism. Investors are rewarded in fees and a rebalancing of their portfolios in an automated manner.
  • Balancer uses a Smart Order Router that enables traders to easily find the best price on the market for the specific coin that they would like to trade by aggregating liquidity sources.
  • The platform also adopts a specific smart contract routing mechanism to optimize the use of gas fee and network subsidies.  
  • Balancer protocol has been proven to be beneficial for many other DeFi platforms especially in lending and borrowing types of DeFi such as Aave, Algorand, and Ocean protocol. 
  • The Balancer technological innovation is all on open-source license so that anyone can build or innovate based on the Balancer technology.

Key Metrics

TickerBAL
Token NameBalancer
Token Type/ProtocolERC20/Ethereum
Total Token Supply100,000,000
Current Circulating Supply See Coinmarketcap
Market CapitalisationSee Coinmarketcap
Token Creation DateJune 2020
Can it be mined?No

Who is behind Balancer? 

Balancer started as a research project conducted by Fernando Martinelli and Mike McDonald at a software consulting firm named BlockScience, in 2018. Balancer Labs was then founded in 2020 to establish and grow the platform. 

What is the purpose of Balancer? 

Balancer is designed to provide efficient trading by pooling liquidity from investors and finding the best price for traders with BAL functioning as a governance token on the Balancer ecosystem. 

Insights:

The Balancer platform has a unique value proposition as a balancer of investors digital asset investment funds. Besides serving retail traders and investors, what Balancer has is also beneficial for other DeFi projects.

  • One of the unique values the Balancer platform has that could separate them from the rest of the DeFi platform is a feature that enables network participants to bundle up to eight tokens into a pool. 
  • There are 65 million BAL tokens allocated for the platform users that provide liquidity. With the current distribution rate, all BAL max supply is expected to be reached in 2028.
  • Balancer also offers public and private pools that provide more options according to users’ needs.
  • On the Balancer platform, App developers could create a smart pool, launch their own token, get access to Balancer data, and utilize price oracle that could connect the app blockchain data with updated token market price on many exchanges.  

Risks:

  • BAL is distributed every week to the platform liquidity provider. There is an obligation for the platform users and token holders; to grow at a higher rate than the token inflationary rate in order to maintain the token value growth phase. 
  • The risk of product substitution also needs to be considered due to a rapid growth of the DeFi ecosystem and users could manage their portfolio in various different methods especially with the raising of new DeFi & CeFi product innovation. 

News and Updates:

  • Balancer received a $24.25m VC funding in May 2021, led by Blockchain Capital, Fenbushi Capital, etc. Details of the press release could be found here.
  • Balancer Lab is holding a bug bounty program with a reward pool of $2m. 
  • Balancer – Polygon farming pool is launched with attractive rewards. Details of the mechanism can be found here

Community & Whitepaper Links:

Disclaimer

All investment is speculative and involves substantial risk and uncertainty. Investors should understand the nature of digital assets including the terms of return and the risk of assets. We encourage investors to fully understand the assets and the risk associated with them prior to making any investment.  

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