One of the most important automated market makers (AMM) in the Ethereum ecosystem, Balancer Labs, has teamed up with Gnosis with the aim of creating a new decentralized exchange (DEX).
The AMM of Balancer already forms a de facto DEX, but it is not used similarly to SushiSwap or Uniswap. The new Balancer-Gnosis-Protocol (BGP) would change the DeFi landscape and create a true competitor for Uniswap.
The idea behind the creation of the BGP is to merge the improved vault system of Balancer v2 and the price-finding mechanism created by Gnosis. It is estimated that BGP will also create a new standard for UX, transparency, and pricing.
At the center of the new DEX is a system that the Ethereum community has been talking about constantly for a couple of weeks now – Miner Extractable Value (MEV), which makes use of an auction system to get better pricing.
“MEV is a phenomenon currently extracting the value of up to 1% of all DEX trades on Ethereum, with value going from users to miners or other arbitrageurs. With BGP, and in particular Gnosis Protocol v2, we built a trading protocol that protects users and makes sure the value stays with them,” declared the CEO of Gnosis, Martin Köppelmann.
The launch date of the DEX has been scheduled for mid-June 2021.