A leading automated market maker, Balancer has launched version 2 of the protocol, claiming much faster speed, lower costs and improved liquidity.
In order to reconstruct the user interface, Balancer’s backend development will provide more efficient routing for trades through “Protocol Vault.” The platform states that the upgrade will decrease gas costs, which are expected to be 40% lower, and produce better pricing mechanisms.
Along with the v2 launch, the development arm behind the AMM, Balancer Labs also announced a partnership with DeFi protocol Gnosis to deliver an enhanced user experience to traders across price, user experience and transparency.
Automated Market Makers(AMM) are basically smart contracts that generate a liquidity pool of tokens, which are traded automatically through a programmable algorithm and are opposed to an order book or centralised exchanges. This allows assets to be swapped automatically.
AMMs are an essential part of the rapidly growing DeFi industry which, according to industry estimates, has grown eightfold since the start of 2021. The DeFi has locked over $160 billion in assets as of the time this writing.
The platform’s native token BAL has set several record highs during this year on the back of positive protocol integrations, gas fee reimbursements and a surge in DeFi trading activity. A buzz within the industry is that possible Coinbase listing has also contributed to BAL’s tremendous growth.
The price of BAL was little changed at $67 on Tuesday for a total market capitalization of $722 million. BAL is the 31st largest DeFi protocol by market cap, according to the leading crypto aggregator Coingecko.