Review on Balancer by Fanuel PORPORTY
Balancer, the ERC-20 exchange
The Balancer protocol is an actor in Decentralized Finance. It is a decentralized, non-custodial exchange that operates through community-fed liquidity pools. Balancer works like Uniswap, but with a few notable differences that make it a more flexible tool. Balancer makes it possible to use inactive capital even if it is not distributed uniformly over the different tokens, thanks to a principle of pool balancing. Which amounts to canceling outright the 50/50 ratio present on Uniswap.
Unlike Uniswap, where the pools always contain two tokens in the same proportions. Balancer supports pools containing up to 8 tokens and whose distribution can be customized. Balancer has its BAL governance token, the only way to receive BAL tokens is to use Balancer protocol services. It is the honeypot used to attract liquidity into its universe by rewarding their owners.
Pros
- Decentralized Finance is currently experiencing strong adoption.
- Governance is decentralized through the dedicated BAL token.
- Very easy to use protocol
Cons
- Lots of competition
