Balancer, a decentralized finance protocol with over a billion dollars in assets, has launched the third version of its services on top of Arbitrum, an Ethereum L2. The new version improves over its previous iteration by including key features designed to ease the user experience while maximizing yield and stabilizing the pools in times of stress.
One of the key improvements that this new version brings is the introduction of boosted pools, liquidity pools that automate certain tasks to increase the yield obtained by liquidity providers.
Unlike traditional pools where funds sit idle and serve as liquidity for earning fees and facilitate decentralized trading swaps, boosted pools allow these funds to be moved to external lending markets, earning additional yields without user involvement. At the same time, trading is guaranteed to continue as a significant part of the liquidity is still maintained in the pool.
Another improvement of Balancer in this third version comes in the form of hooks, a feature that makes it possible to customize the behavior of liquidity pools depending on certain conditions. For example, Stablesurge, a hook, protects stable assets from de-pegging while facing stressful market conditions, securing an efficient operation of exchange operations.
Balancer emphasized the relevance of Arbitrum in optimizing its systems for maximum efficiency, highlighting the usefulness of a low-fee environment for its operation. It stated:
With Arbitrum’s low fees and high-speed execution, Balancer’s technology — Boosted Pools, Hooks, custom AMMs, and deep protocol integrations — can operate at peak efficiency.
In the coming days, Balancer will launch a series of incentives to position itself as one of the key liquidity hubs in Arbitrum, establishing alliances with other protocols such as Lido and Avave to this end.
Read more: Balancer Introduces Boosted Pools, Developer Tools in v3 Update; Partners With Aave
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