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What is Balancer (BAL)? Everything you need to know about BAL

publish_by Quang Phan at 04 tháng 11 2021

Since 2020, the battle of AMMs has been more tremendous than ever, especially on Ethereum. Uniswap, Sushiswap, and Curve Finance are undoubtedly ranked as the top 3 AMMs at the moment. Right next to them, there is Balancer.

In this article, I will introduce you to the Balancer protocol and its token BAL, with a clear insight into Balancer's approach compared to other competitors.

What is Balancer?

Balancer is an Automated Market Maker Protocol runs on Ethereum Blockchain, therefore, Balancer possesses its uniqueness to compete with other AMMs namely Uniswap or Curve Finance.

AMM (Automated Market Maker) is the exchange model that enables decentralized trading by using algorithms and smart contracts to determine the price of the assets. These activities happen within a liquidity pool, where users contribute liquidity to gain incentives from the project, namely the project’s native token.

What is BAL Token?

BAL is the governance token for the Balancer Protocol. It can be used to vote on proposals and steer the direction of the protocol.

Recently from March 8th 2021, 30,000 BAL from the Ecosystem Fund have been allocated to the “BAL for Gas’’ campaign, using BAL to benefit both traders and liquidity providers.

How does Balancer work?

Balancer aims to provide a flexible platform for “programmable liquidity” with up to eight assets per liquidity pool. Therefore, Balancer has to use “Smart Pool” - Pools using Smart Contracts as the main controller, which adjust parameters following arbitrary logic instead of the default 1:1 ratio like other AMM pools.

In other words, if Uniswap defines price curve by following a similar formula of x*y=k, then Balancer is like Uniswap in N-dimensions.

Uniswap vs Balancer comparison

One very powerful feature of Balancer is the use of Smart Pool, a smart contract controlled pool allowing complex logic to readjust balances. Some examples can be listed as:

  • An interest bearing stablecoin pool without impermanent loss.
  • A pool that adjusts swap fees as a function of the volatility of the pool's assets.
  • A pool that updates weights to implement a particular market strategy (e.g., a Liquidity Bootstrapping Pool).
  • More complex dynamic strategies for asset allocation.

Balancer benefits multiple types of users, namely Liquidity Providers, Traders and Builders.

Liquidity Providers can be:

  • Portfolio managers who want their portfolios to remain balanced without considerable expenses. They will collect fees from traders who follow arbitrage opportunities and rebalance their portfolios.
  • Investors who own idle funds and would like to earn passive income.

Traders can be:

  • "Retail" traders who want to swap ERC-20 tokens with low slippage.
  • Arbitrageurs who seek profit by utilizing price differences between DEXs or CEXs.
  • Ethereum smart contracts who seek liquidity for a variety of reasons, such as liquidating positions on other protocols, trading on behalf of users,...

Builders can be developers who want unprecedented customizability over the programmable liquidity that Balancer provides.

Recently, Balancer has updated to Version 2 with multiple fresh features, such as Flash Loans, Flash Swaps, super-charge capital efficiency, custom AMMs,...

Detailed information about BAL Token

BAL Price Today

Currently, you can track the price of BAL on Coin98 Markets: https://markets.coin98.com/currencies/balancer

Coin98 Markets is a website that helps users to get updates of the real-time prices, as well as view the detailed information of a Token Metric from any project. More specifically, you can access the home page or the community page of a project, or filter the coins/tokens by Market Cap, Trading Volume, etc.

BAL Price. Updated: August 18, 2021.

BAL Key Metrics

  • Name: Balancer.
  • Ticker: BAL.
  • Token standard: ERC-20.
  • Token type: Governance.
  • Max supply: 100,000,000 BAL.
  • Circulating Supply: 10,799,858 BAL.
  • Contract address: 0xba100000625a3754423978a60c9317c58a424e3d

BAL Token Allocation

BAL Token Allocation

BAL Token Sale

BAL Token Sale

BAL Token Release Schedule

145,000 BAL per week, or approximately 7.5M BAL per year, are distributed to liquidity providers. It is estimated to take about 8.6 years to fully distribute 65M BAL.

BAL Token Use Cases

Currently, BAL token can be used for:

  • Governance voting and proposals.
  • Gas fees for both liquidity providers and traders.

How to get BAL Token

You can get BAL through multiple options:

  • DEXs: Coin98 Exchange, Uniswap, Balancer,...
  • CEXs: Huobi, Binance, FTX,...
  • Trading and providing liquidity on Balancer.

How to buy BAL

You can buy BAL through Coin98 Exchange by performing the following steps at: exchange.coin98.com

Step 1: Connect Coin98 Extension Wallet.

Step 2: Select Uniswap.

Step 3: Choose the trading pair:

  • Search BAL.
  • If the result does not come up, you can paste the contract of BAL into the search box: 0xba100000625a3754423978a60c9317c58a424e3d

Step 4: Adjust the amount you want to swap.

Step 5: Adjust the gas fee, then click Approve.

How to buy BAL on Coin98 Exchange.

How to store BAL

You can store BAL token on Coin98 Wallet with these steps:

Step 1: Open Coin98 Wallet & click Receive on the home screen.

Step 2: Search BAL Token.

Step 3: Click on the correct result, copy the wallet address and send BAL to this address.

How to store BAL on Coin98 Wallet.

Balancer Roadmap

The Bronze Release

  • During: March 2020.
  • The Bronze Release emphasized code clarity for audit and verification, and did not go to great lengths to optimize for gas.

The Silver Release

  • During: May 11, 2021 (Balancer V2).
  • This update brought many gas optimizations and architecture changes that would reduce transaction overhead and enable more flexibility for managed pools.

The Golden Release

  • Date: TBC.
  • This phase will introduce a new liquidity mechanism to the market.

Team, Investors and Partners

Team

  • Fernando Martinelli: Co-founder and CEO of Balancer Labs.
  • Mike McDonald: Co-founder and CTO of Balancer Labs.
Balancer team

Investors

Launched in March 2020, Balancer has attracted enormous attention all over the DeFi space. Balancer’s direction is affected by Balancer Labs, which raised $3 million in the seed round.

Balancer is also invested by multiple popular capitals, namely Alameda Research, Three Arrows Capital, CoinFund, Defiance Capital, Accomplice,…

Balancer investors.

Partners

Aave, Gnosis, Polygon, Gauntlet, Token Engineering Academy,... and multiple Dapps have cooperated with Balancer.

Balancer partners

Is Balancer (BAL) a good investment?

I hope that with the aforementioned information, you have understood what Balancer is and how Balancer works. This article should give you a deep insight into the project, so there is no financial advice. You should Do Your Own Research before conducting any investment, and be responsible for your own fund. However, Coin98 will provide some notable points of the project to give you the best overview to make your own decisions.

  • Balancer is an AMM providing up to 8 assets in one pool instead of normally 2, which benefits multiple types of users listed above. If you are among one of those users, you are likely to take advantage of Balancer's features.
  • The Total Value Locked in Balancer is currently $2.93B, only behind Curve, Uniswap and Sushiswap in order.
  • Balancer released Version 2 in May 2021, implementing a variety of adjustments to improve the efficiency.
  • Balancer has recently introduced Stable Pools and MetaStable Pools, promising to further increasing Pool Liquidity.

Conclusion

There are various AMMs on the market at the moment, however, Balancer with its uniqueness of using Smart Pools and programmable liquidity can introduce to users the flexibility and permissionless control.

This is the main reason why Balancer has been an outstanding AMM compared to its competitors. With the recent introduction of Balancer V2 bringing multiple updates and features, Balancer is promised to remain strong and steady on the market for the time being.

You’ve been through an article about Balancer and the BAL token. I hope it has helped you in gaining more useful insight of this project and understanding its potential.

If you want to know further about Balancer (BAL), please feel free to leave a comment below and join Coin98 Community for further discussions!

Quang Phan

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