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About Balancer
Key Points
- Launched in March 2020 on the Ethereum blockchain
- Raised $3M in seed funding from Placeholder and Accomplice
- Automated market maker (AMM) and liquidity provider
- Allows users to earn profits through customizable liquidity pools and token ($BAL)
Pool Types
- Private pools: owner has governance and sole contributor of liquidity
- Shared pools: for liquidity providers (LPs), rewarded with Balancer Pool Tokens (BPTs)
- Smart pools: controlled by smart contract, rewards with BPTs, and allows anyone to contribute liquidity</
About Balancer: Harmonizing DeFi through Intelligent Asset Management
Introducing Balancer (BAL): A DeFi Powerhouse
Balancer, an innovative automated market maker (AMM) built on the Ethereum blockchain, was launched in March 2020, following a successful $3 million seed funding round led by Placeholder and Accomplice. This cutting-edge protocol operates as a self-rebalancing, weighted portfolio, price sensor, and liquidity provider, empowering users to generate profits through its native token ($BAL) by contributing to customizable liquidity pools.
To delve deeper into this project, we invite you to explore our comprehensive analysis of
Balancer
.
The protocol orchestrates a diverse range of pools, each serving a distinct purpose:
- Private pools afford their owners absolute governance, granting them sole discretion over liquidity contributions and the flexibility to modify parameters at will.
- Shared pools cater to aspiring liquidity providers (LPs), who are incentivized with Balancer Pool Tokens (BPTs) in return for their contributions.
- Smart pools, akin to private pools, are governed by smart contracts, rewarding contributors with BPTs and permitting anyone to contribute liquidity to the pool.
The Visionaries Behind Balancer: Meet the Founders
Balancer Lab was co-founded by Fernando Martinelli and Mike McDonald, originating as a research initiative within the esteemed software firm BlockScience in 2018. The Balancer project boasts a talented ensemble of like-minded visionaries, possessing a profound comprehension of the DeFi landscape.
Unveiling the Unparalleled Attributes of Balancer
Balancer bears similarities to Uniswap and Curve, as it empowers users to create pools of tokens. Notably, the pool dynamically adjusts to maintain an equal weighting of tokens, regardless of fluctuations in their market value. A distinctive feature of Balancer, however, is its ability to accommodate multiple tokens and operate independently of ETH.
Notwithstanding its predecessors, Balancer has revolutionized the DeFi landscape by introducing a novel approach to liquidity provision. A distinctive feature of the protocol is its ability to accommodate up to eight assets per market, with each asset weighted by percentage and rebalanced automatically, thereby providing unparalleled flexibility to liquidity providers.
With Balancer, users are afforded the flexibility to determine the precise amount of a supported asset they wish to deposit, liberating them from the conventional requirement of depositing 50% of the desired asset. Furthermore, Balancer Lab boasts a distinctive feature that enables users to capitalize on arbitrage opportunities and reduce slippage, thereby generating substantial returns on assets with low demand. You can learn more about how Balancer works
here
.
What Is the Circulating Supply of Balancer Tokens (BAL)?
Balancer didn’t debut with a native token. However, in June 2020, it introduced a governance token, $BAL, inspired by the success of Compound’s token COMP. The primary objective of this token is to facilitate further decentralization and serve as an incentive for liquidity providers (LPs).
Out of the total 100 million tokens created, 25 million were set aside for the team, core developers, investors, and advisors. A further 5 million tokens were earmarked for the Balancer Ecosystem Fund, which would serve as incentives for strategic partners. An additional 5 million tokens were allocated to the fundraising fund, which would be utilized by Balancer to support its operational expenditures and fuel future growth through subsequent fundraising initiatives.
The remaining tokens are slated to be mined by liquidity providers on the platform, with a weekly release of 145,000 tokens. Assuming a consistent distribution rate, it is estimated that it will take approximately 8.6 years to complete the token distribution process.
The Security Paradigm of the Balancer Network
At Balancer, security is paramount, which is why the protocol has undergone rigorous, triple audits by esteemed firms Trail of Bits, ConsenSys, and OpenZeppelin. Notably, the protocol is devoid of admin keys and backdoors, ensuring a trustless environment. Furthermore, Balancer pools are immutable, meaning they cannot be upgraded. Additionally, the platform only supports tokens that strictly adhere to the ERC-20 standard, even if non-compliant tokens are utilized in certain pools.
The tokens held within Balancer pools operate independently, governed by smart contracts rather than being controlled by Balancer itself. However, this decentralized nature does not mitigate the inherent risks associated with smart contracts. To address this, the configurable rights pools (CRPs) have been implemented, effectively barring tokens with known issues from being utilized in pools and ensuring seamless, secure interactions between all other tokens and the protocol.
Where to Acquire Balancer Token (BAL): A Comprehensive Guide
Balancer enables users to contribute to liquidity pools, thereby earning $BAL, which is automatically distributed to users on a weekly basis. Notably, prominent exchanges that support $BAL include Binance, ZenGo, Global, HBTC, Kraken, OKEx, and Huobi, among others. For a comprehensive guide on exchanging fiat currencies for $BAL, please refer to our detailed tutorial.
Fernando Martinelli, a visionary entrepreneur and esteemed member of the Maker community, has
Boasting an extensive background of professional experience beyond Balancer, he has a proven track record of entrepreneurial success, having co-founded multiple companies prior to launching Balancer alongside his partner, Mike McDonald.
Meet Mike McDonald, Co-Founder and Chief Technology Officer at Balancer, a seasoned security expert
Meet the ingenious engineer and visionary behind mkr.tools, who collaborated with Fernando Martinelli to bring the innovative Balancer platform to life.