The Crypto Cinematic Universe Crossover Event of the Summer: Balancer-Gnosis-Protocol (BGP)
Balancer Labs and Gnosis partner to favor cooperation over competition
The Balancer-Gnosis-Protocol (BGP) alliance combines the best of both protocols, with Balancer V2’s flexible liquidity pools enabled by a single-vault architecture and asset managers, in combination with Gnosis Protocol v2’s price-finding mechanism and MEV protection.
The DEX space is constantly evolving. What was a smaller sector within the Ethereum community, has transformed into a multi-billion dollar industry. With collaboration, we believe that we can out-cooperate the competition — traditional finance — by providing unparalleled decentralization, transparency, and value in our tools.
Time to move away from competition and embrace cooperation.
Fragmented liquidity across protocols leads to users getting worse prices. Users being exposed to MEV, Miner Extractable Value, causes higher gas fees or poorer pricing due to manipulation. One way to diminish MEV is if a protocol manages to get liquidity providers and users to cooperate with one another.
With this partnership, we want to create the most capital-efficient DEX while offering a trading venue that protects users from MEV. The combination of Balancer asset managers and the capabilities of Gnosis Protocol support efficient market making.
“We’re proud to bring two teams known for great engineering, Balancer Labs and Gnosis, together in this collaboration.” — Fernando Martinelli, Balancer CEO.
The aim of the Balancer-Gnosis-Protocol (BGP) is to self-regulate the space to move from current fixed rules that apply specific parameters, to upgradeable rules that change parameters according to market conditions.
These changeable rules are applied to market makers and traders with the goal of keeping the value from the miners while distributing it across BGP’s users in the form of better prices. For example, governance could establish a flexible liquidity provider fee or a variable fee for professional solution submission to set tight slippage on the trades.
The Balancer-Gnosis-Protocol (BGP) will be rolled out through several release stages.
- CowSwap alpha (GPv2): Today, users can trade on the proof-of-concept CowSwap dApp. The Gnosis Protocol V2 (GPv2) engine will be progressively rolled out, ultimately offering a 90% reduction in transaction costs. Note: While peer-reviewed, CowSwap is currently undergoing a more formal audit, and users participate at their own risk.
- Balancer v2: Balancer V2 was recently released for developers, giving traders the ability to migrate liquidity over the coming weeks. In Stage 2, liquidity will be incentivized to move from Balancer V1 to Balancer V2 with a $BAL incentive program.
- CowSwap beta (GPv2): CowSwap upgrades from alpha to the final GPv2 contracts integrated with Balancer V2.
- Balancer-Gnosis-Protocol: Targeted for mid-June, Balancer V2 will be fully integrated with Gnosis Protocol v2 in the Balancer-Gnosis-Protocol (BGP) dApp, and a joint incentive program will be kicked off.
We’re thrilled to be partnering with a key ecosystem partner like Gnosis. As a protocol that has constantly developing foundation tooling for the DeFi ecosystem at large, we’re excited to combine the best of both worlds to offer traders the best experience to date.
This partnership marks yet another Balancer V2 launch partner, more of which will be shared in the coming weeks. Until then, keep your eyes peeled for more upgrades coming to Balancer.
Balancer Protocol allows for automated portfolio management and provides liquidity turning the concept of an index fund on its head: instead of paying fees to portfolio managers, you collect fees from traders who rebalance your portfolio by following arbitrage opportunities. Developers leverage Balancer as a permissionless building block to innovate freely and create new treasury management systems. Balancer Lab’s mission is to become the primary source of DeFi liquidity by providing the most flexible and powerful platform for asset management and decentralized exchange.
To learn more, please visit https://balancer.finance/.
Gnosis builds new market mechanisms for decentralized finance. Our three interoperable product lines allow users to securely create, trade, and hold digital assets, currently enabling users to manage more than $26 Billion on Ethereum. Gnosis was founded in 2015 by Martin Köppelmann and Stefan George as part of ConsenSys, the globally leading Ethereum venture production studio. In April 2017, Gnosis raised funds and spun out of ConsenSys to become an independent company now with more than 60 employees.
To learn more, please visit https://gnosis.io/
CowSwap DEX: https://cowswap.exchange/: CowSwap is a proof-of-concept decentralized application built on Gnosis Protocol v2 (GPv2). CowSwap offers the decentralized finance community a teaser of the capabilities of GPv2 through testing upcoming features while placing nearly gas-free trades. Please note the proof-of-concept dApp is in alpha and is currently undergoing a formal audit process.