DeFi Staple Balancer Launches Boosted Pools With Aave
Share this article
Balancer is hoping that the update will increase yields for liquidity providers.
DeFi Mainstays Announce Collaboration
Two of DeFi’s most popular protocols are coming together to increase yields for users.
Balancer has announced its plans to launch Boosted Pools with Aave, allowing for greater capital efficiency and higher yields for liquidity providers. Fernando Martinelli, the CEO and co-founder of Balancer Labs, said of the update:
“The collaboration with Aave as the first iteration of the Boosted Pools launch is a natural fit and solidifies their place in the Balancer ecosystem. There are various levels of Boosted Pool innovations that lead to concrete results, deeper liquidity, more efficient integrations for liquidity, and higher yields.”
Aave founder and CEO Stani Kulechov added that the launch would offer users deeper liquidity and was “a prime example of [the] incredible innovation happening in DeFi.”
Boosted Pools work by using the full amount of liquidity deposited to a pool rather than the 10% that typically gets used when liquidity is deposited to an automated market maker pool. As trade sizes are smaller than the available liquidity, traders only use a portion of the liquidity. With Boosted Pools, liquidity providers can earn yield on their deposit by accessing lending protocols—in this case, the lending protocol is Aave.
As there tends to be a high entry price to access lending protocols on Ethereum, Aave Boosted Pools create a way for users to optimize liquidity provision by making use of their full deposit. The race to achieve capital efficiency has become a central theme to DeFi in recent months, with projects like Uniswap and Curve announcing features like concentrated liquidity—which lets liquidity providers choose a price range to provide liquidity for—in a bid to offer the best user experience possible.
Many of the leading DeFi projects on Ethereum have also looked to Layer 2 amid soaring gas fees on mainnet. The current leader among Ethereum’s various Layer 2 solutions is Arbitrum, which uses Optimistic Rollup technology to offer users high speed and low-cost transactions while benefiting from the security of mainnet. Balancer has already launched on the project’s scaling network, Arbitrum One, while Aave is set to follow sometime in the future.
Disclosure: At the time of writing, the author of this feature owned ETH, AAVE, and several other cryptocurrencies. They also had exposure to BAL in a cryptocurrency index.
Share this article
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Balancer and Gnosis Are Launching a New Ethereum Exchange
Balancer and Gnosis, two Ethereum mainstays, are uniting to launch a decentralized exchange called the Balancer-Gnosis-Protocol (BGP). DeFi Favorites Link Up Balancer is one of Ethereum’s most popular automated market…
Balancer Is Coming to Polkadot via Moonbeam
Moonbeam, an Ethereum-compatible smart contract parachain, announced it would connect the Balancer protocol with the Polkadot ecosystem. Moonbeam Bridges Balancer, Polkadot The integration with Balancer will add value to the…
What is a Crypto Airdrop: Why Projects Airdrop Crypto
Crypto airdrops occur when new tokens are freely distributed to different wallets in order to drive initial growth and build a community. They represent a popular marketing tactic that new projects use to spread…
Aave Teases Cross-Chain, Layer 2 Plans in V3 Proposal
Aave has published an update describing V3 of its protocol and the new features that will be included in the update. V3 Will Have Layer 2, Interoperability Features Aave’s latest…