Tuesday, April 06, 2021 3:26:47 PM
Proof-of-stake blockchains continue to hunt for DeFi integrations that can help them exploit Ethereum's weaknesses.
By Jeff Benson
3 min read
Apr 6, 2021
In brief
* Balancer is a type of decentralized exchange.
* A new integration could help it convert its popularity on Ethereum to a
new group of assets on Algorand.
Balancer, one of the largest decentralized exchanges built on Ethereum, is coming to Algorand. It’s yet another example of a large DeFi project expanding beyond Ethereum to one of the Ethereum blockchain’s rivals.
According to a press release, Balancer "will be the first automated market maker (AMM) available for use by the Algorand community.” In doing so, it beats out larger rival AMMs Uniswap and SushiSwap.
The team behind Reach, a language for building decentralized apps on Algorand, will build the tool. Balancer Labs tweeted that it is not involved in developing the project but that it had given a $5,000 grant to Algorand. In the release, its head of growth, Jeremy Musighi, stated, "We are excited to provide support to the Algorand and Reach teams via the Balancer Ecosystem Fund, and to observe how this new implementation will work and how it may grow in the future to be a source of liquidity for the Algorand ecosystem."
Like Ethereum, Algorand runs smart contracts—the computer code that automates transactions and removes the need for third parties—and decentralized applications, meaning it’s a network that can host a wide range of services. That includes the suite of intermediary-free lending, borrowing, and trading tools collectively known as decentralized finance (DeFi).
Balancer is a key cog in Ethereum’s DeFi ecosystem. According to DeFi Pulse, it’s the fourth-largest decentralized exchange in terms of total value locked, which refers to the value of crypto in dollars that people have stored in the network.
Decentralized exchanges, or DEXs, are places where people trade cryptocurrencies and participate in DeFi without entrusting their funds to a third party. As an automated market maker (AMM), Balancer uses liquidity pools so that buyers don’t need to be directly matched up with sellers. Smart contracts do the heavy lifting.
But, as long as it’s on the Ethereum blockchain, Balancer’s protocol can only perform swaps for ERC20 tokens, a specific type of asset built atop Ethereum. Expanding to Algorand, then, opens up trading in a whole new set of assets built atop that blockchain known as Algorand Standard Assets.
“By leveraging Balancer's services on Algorand, exchanges will have the ability to create trading pairs with any Algorand Standard Asset (ASA),” the DEX wrote in a press release. “As the number of assets issued on Algorand's high-performing blockchain accelerates, this represents a huge opportunity for mass adoption.”
Balancer won’t be alone. Circle's USDC stablecoin announced last year that it was expanding to Algorand, adding an easier way for crypto traders to get started on that blockchain.
Reach's work to integrate Balancer on the Algorand blockchain doesn’t mean Balancer is forsaking Ethereum, given that Balancer Labs has minimal involvement in the project. "Our attention is solely focused on Ethereum and the upcoming launch of Balancer V2," it tweeted after news of the Algorand integration broke.
But it still puts further pressure on the network as competitors such as, Algorand, Cardano, and Solana exploit Ethereum weakness: congestion and high fees.
That congestion is partially due to Ethereum’s first mover advantages as the original network to embrace smart contracts and the applications they make possible. But it’s also because Ethereum has not yet transitioned from proof of work to a proof-of-stake consensus algorithm, which is more scalable.
The move to Ethereum 2.0 is in progress. Phase 0 launched late last year and Ethereum devs recently suggested the proof-of-stake blockchain might be ready earlier than expected.
Editor's note: This article has been updated to clarify that Balancer Labs is not playing an active role in the project.
https://decrypt.co/64031/balancer-sees-opportunity-outside-ethereum-algorand-uniswap?&utm_medium=referral&utm_campaign=feed&utm_source=coinbase
Recent ALGOUSD News
- Bitcoin Stabilizes at $62,000, SEC Delays Exodus NYSE Listing, and More Crypto News • IH Market News • 05/09/2024 07:28:40 PM
- Ripple, XRPL Labs join Algorand Foundation as founding members of Decentralized Recovery Alliance • Crypto Briefing • 05/09/2024 07:10:05 PM
- Ripple joins multi-chain DeRec Alliance for secrets management • Cointelegraph • 05/09/2024 07:00:00 PM
- Algorand Market Cap And TVL Skyrocket As ALGO Faces Critical Support Test • NEWSBTC • 05/09/2024 12:00:32 AM
- Algorand Foundation CEO’s X Account Compromised As Spree of Crypto Social Media Hacks Continue • The Daily Hodl • 01/27/2024 09:00:09 PM
- Hedera (HBAR) Shines: Record-Breaking 164 Million Daily Transactions, Market Cap Reaches $2.9 Billion • NEWSBTC • 01/27/2024 01:00:15 AM
- Bitcoin Crash Ahead: Expert Predicts Testing $20K Before Rebound • NEWSBTC • 01/26/2024 11:00:46 PM
- Hacker mocks Algorand after maintaining control of CEO’s X account for 15 hours • Cointelegraph • 01/26/2024 07:40:00 PM
- Algorand CEO’s X Account Hacked, Is Justin Sun Involved? • NEWSBTC • 01/26/2024 03:10:48 PM
- Algorand CEO’s X account compromised, hacker posts satirical tweets • Crypto Briefing • 01/26/2024 10:36:13 AM
- Algorand CEO’s hacked account dances into pole position • Cointelegraph • 01/26/2024 08:20:00 AM
- Bitcoin Whale Addresses Hit 15-Month High – A Sign Of Growing Accumulation? • NEWSBTC • 01/20/2024 08:20:14 AM
- Algorand (ALGO) Stuns In Q4: Market Cap Soars, TVL Doubles, And User Base Skyrockets • NEWSBTC • 01/20/2024 03:00:25 AM
- Algorand shaves block times by 20% after Dynamic Lambda upgrade • Cointelegraph • 01/18/2024 04:41:22 AM
- Hedera partners with Algorand to develop a ‘decentralized recovery’ protocol • Crypto Briefing • 01/12/2024 12:14:16 AM
- Hedera and Algorand partner to develop decentralized wallet recovery system • Cointelegraph • 01/11/2024 02:14:17 PM
- XRP In December 2023: Decoding An 800% Nostalgia And The Hope For $1 • NEWSBTC • 12/25/2023 12:00:15 PM
- Polkadot Pops: Price Hits Fresh 2023 Peak, Breaking Through Doubts • NEWSBTC • 12/24/2023 12:10:23 PM
- Google AI Predicts When XRP Price Will Cross $5 And What Will Drive It • NEWSBTC • 12/24/2023 10:40:28 AM
- Solana Surges Above $117 As Meme Coin Craze Extends Market Momentum • NEWSBTC • 12/24/2023 06:31:30 AM
- Bitcoin's 8-week win streak is in danger, but ATOM, FIL, EGLD, and ALGO don't care • Cointelegraph • 12/17/2023 03:52:15 PM
- FIFA launches NFT collection amid 2023 World Cup • Cointelegraph • 12/11/2023 07:24:07 PM
- Crypto This Tuesday: BlackRock Receives $100,000 for Bitcoin ETF, Robinhood’s Trading Volume Grows 75%, and More • IH Market News • 12/05/2023 06:39:22 PM
- United Nations agency to upskill thousands of staff in blockchain tech • Cointelegraph • 12/01/2023 05:02:59 AM
- Crypto this Thursday: Robinhood Aims for British Market, MicroStrategy Expands Investment in BTC, and More • IH Market News • 11/30/2023 07:40:35 PM
Avant Technologies Equipping AI-Managed Data Center with High Performance Computing Systems • AVAI • May 10, 2024 8:00 AM
VAYK Discloses Strategic Conversation on Potential Acquisition of $4 Million Home Service Business • VAYK • May 9, 2024 9:00 AM
Bantec's Howco Awarded $4.19 Million Dollar U.S. Department of Defense Contract • BANT • May 8, 2024 10:00 AM
Element79 Gold Corp Successfully Closes Maverick Springs Option Agreement • ELEM • May 8, 2024 9:05 AM
Kona Gold Beverages, Inc. Achieves April Revenues Exceeding $586,000 • KGKG • May 8, 2024 8:30 AM
Epazz plans to spin off Galaxy Batteries Inc. • EPAZ • May 8, 2024 7:05 AM