This proposal was authored by the Ava Labs team in collaboration with the Balancer team.
Summary
This proposal seeks community support for the deployment of Balancer V3 on Avalanche, aligning with Avalanche’s mission to Tokenize the World’s Assets. Balancer v3 will bring to Avalanche’s DeFi ecosystem unique innovations to further onchain liquidity provisioning for crypto native and real world assets.
Introduction
Avalanche is an ultra-fast, low-latency EVM compatible layer 1 blockchain platform designed for builders who need high performance at scale. The network’s architecture allows for the creation of sovereign, efficient and fully interoperable public and private layer 1 (L1) blockchains which leverage the Avalanche Consensus Mechanism to achieve high throughput and near-instant transaction finality. Avalanche’s C-Chain is the central hub for DeFi liquidity within Avalanche’s multichain network. Deploying Balancer V3 will enhance the existing DeFi ecosystem on Avalanche.
Motivations
Integrations with Avalanche’s Expanding DeFi Ecosystem
Avalanche’s native DeFi ecosystem TVL has grown almost 2x in the past 7 months, bolstered by increased liquidity on AMMs and lending protocols. Deploying Balancer V3 will enable immediate integrations with key Avalanche native lending protocols, like Aave and BENQI, providing increased yields to Balancer V3 LPs and further increasing lending protocol liquidity. This deployment will give liquidity providers with more options within Avalanche’s growing AMM landscape.
Streamlining Onchain Market Making for Long Tail and Real World Assets
Avalanche has been at the forefront of bringing traditional financial institutions onchain for the last few years. Key players such as Blackrock, Securitize, Franklin Templeton, and KKR have deployed various tokenized fund products on Avalanche. Balancer’s multi-asset pools and custom hooks will provide such asset issuers with more options to customize their onchain trading infrastructure on Avalanche in ways that were not possible before and diversify the assets listed on Balancer v3.
Positioning Avalanche as a Leading DeFi Ecosystem
Balancer V3 deployment on Avalanche will further solidify Avalanche as a go-to destination for DeFi builders. Avalanche’s robust DeFi ecosystem has weathered through multiple cycles with proven players emerging across decentralized exchanges, onchain lending, derivatives trading, and yield aggregation.
Proposal
This proposal asks the community to support the deployment of Balancer V3 on Avalanche. Specifically, we propose the following:
Authorize the deployment of Balancer V3 on Avalanche C-Chain to provide advanced liquidity solutions and market-making capabilities.
Collaborate with the Balancer team to ensure a seamless integration and deployment that benefits the entire Avalanche ecosystem.
Deploy joint liquidity mining incentives to drive user acquisition and liquidity growth on launch.
Timeline and Next Steps
The deployment of Balancer V3 on Avalanche is expected to launch by the end of March 2025. In the coming weeks, the Ava Labs and Avalanche Foundation teams will work closely with the Balancer team to finalize integration details and ensure full compatibility with Avalanche’s DeFi ecosystem.