Balancer Deploys on Avalanche to Fuel Liquid Staking Growth and New DeFi Opportunities
Balancer, a decentralized automated market maker (AMM) with over $1B in total value locked, has deployed on Avalanche. This move by Balancer, a pioneer of Ethereum DeFi, is an effort to fuel liquid staking growth on Avalanche and to give participants new DeFi possibilities.
Avalanche offers high throughput, fast finality, impressive energy efficiency, and the ability to scale through custom Subnets. Balancer, as a core building block of Web3 infrastructure, has recognized the potential of Avalanche and is deploying its technology to offer participants a more flexible DeFi tech stack.
In addition to the launch, Balancer will be collaborating with four key Avalanche LST protocols, giving the Avalanche Liquid Staked Token (LSTs) market a place to unite under one hood.
How Could Balancer Supercharge LST Growth?
Balancer aims to be one of the most efficient DeFi infrastructures to host LSTs. Compared to a typical stable pool that most DEXs implement for LSTs, Balancer’s Composable Stable Pools are programmatically tailored to ensure that the full power of yield-bearing tokens flow to liquidity providers.
These unique pools harness an inbuilt rate provider that constantly queries the blockchain, updating the token to the correct ratio and feeding the yield accrual back to LPs. Without rate provider technology, the two assets trade at 1:1, with any appreciation in staking yield filtered out to arbitrage traders. Integrated into core pool mechanics and efficient liquidity flywheels, Composable Stable Pools offer users and protocols one of the most efficient technologies to host and increase their token use.
Balancher’s Boosted Pools intertwine its Liquidity Pools and single-sided yield markets into one powerful LP position. In a typical Liquidity Pool, less than 20% of the liquidity facilitates swaps. Boosted Pools wrap and route idle liquidity to external yield-generating protocols such as Aave, unlocking an additional source of Liquidity Mining incentives for users.
Critically, Avalanche LST protocols will be allying with Balancer to elevate Avalanche’s LST capabilities. Balancer is positioned to host the liquidity of sAVAX by BENQI, ankrAVAX by Ankr, yyAVAX by Yield Yak, and ggAVAX by GoGoPool to boost the Avalanche LST market.
“Balancer has emerged as a keystone for LST liquidity, and its novel features will directly benefit BENQI's more than 41,000 sAVAX users,” said Dan Mgbor, Co-founder, BENQI. “From facilitating more efficient trades to enabling liquidity providers to earn higher yields, our combined efforts aim to enhance the utility of sAVAX and turbocharge its adoption. With the launch of Balancer, a new chapter begins for LSTfi on Avalanche, and we're thrilled to be at the forefront of this journey together.”
“Avalanche’s established ecosystem, which includes several liquid staking tokens and sAVAX with nearly $100M TVL, are strong liquidity sources Balancer LPs can tap into,” said Luigi D’Onorio DeMeo, Head of DeFi at Ava Labs. “With this deployment, Balancer has the opportunity to become the main destination for staked derivatives on Avalanche.”
Provided for informational purposes only, without representation, warranty or guarantee of any kind. None of this is as an endorsement by Ava Labs, Inc., the Avalanche Foundation Limited or any of their respective subsidiaries or affiliates, nor is any of this investment or financial advice. Please review this Notice and conduct your own research to properly evaluate the risks and benefits of any project.
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