BalancerV2-Polygon is a decentralized finance (DeFi) protocol built on the Polygon network. Its purpose is to enable users to create and manage automated portfolios called liquidity pools, which contain multiple tokens. BalancerV2-Polygon was founded by Mike McDonald and Fernando Martinelli, and was launched in 2021. The protocol's name "Balancer" refers to its features that automatically rebalance token allocations within pools. Key facts include its use of smart contracts for transparency and automation, and its aim to provide efficient and customizable liquidity management for DeFi users.
BalancerV2-Polygon offers several benefits compared to its direct competitors. One key advantage is its scalability and low transaction fees. As an Ethereum Layer 2 scaling solution, Polygon allows for faster and cheaper transactions compared to directly using the Ethereum mainnet. This can greatly improve the user experience, particularly for traders and DeFi users who rely on efficient and cost-effective transactions.
BalancerV2-Polygon also benefits from the robustness and security of the Polygon network. With its Proof of Stake (PoS) consensus mechanism, Polygon provides a high level of security for smart contracts and user funds. This can provide users with enhanced trust and confidence in utilizing BalancerV2-Polygon.
Another advantage of BalancerV2-Polygon is its interoperability. As it operates on the Polygon network, it can easily integrate with other decentralized applications (dApps) and protocols within the Polygon ecosystem. This allows for seamless and efficient liquidity provision and trading across various platforms.
While there are other decentralized exchange platforms available, such as Uniswap and SushiSwap, BalancerV2-Polygon offers unique features and benefits. With its customizable liquidity pools and automated portfolio management, BalancerV2-Polygon provides users with greater flexibility and control over their investments. It allows for more efficient trading with customizable weightings and multiple tokens in a single pool.
Overall, BalancerV2-Polygon stands out with its scalability, low transaction fees, strong security, and interoperability within the Polygon ecosystem. These benefits make it an attractive choice for users looking for efficient and customizable decentralized exchange solutions.
BalancerV2-Polygon is a decentralized exchange (DEX) protocol that operates on the Polygon blockchain. This protocol is built on the Ethereum network and uses smart contracts to facilitate the trading of digital assets.
Underlying Technology: BalancerV2-Polygon leverages the power of automated portfolio management, allowing users to create customizable liquidity pools with multiple tokens. It utilizes an Automated Market Maker (AMM) mechanism, which means that trades are executed directly against liquidity pools instead of relying on buyers and sellers to create individual trades.
Blockchain Used: BalancerV2-Polygon operates on the Polygon blockchain, which is a layer 2 scaling solution for Ethereum. Polygon offers faster transaction speeds and lower fees compared to the main Ethereum network, making it an efficient choice for decentralized applications (DApps) like Balancer.
Functioning: BalancerV2-Polygon enables users to provide liquidity to token pools by depositing multiple tokens in various proportions. The protocol then dynamically adjusts the weightings of these tokens based on supply and demand, ensuring that the pool remains in balance. Traders can then trade against these pools, taking advantage of the automated pricing mechanism.
BalancerV2-Polygon also incorporates smart order routing, which allows users to access liquidity across various exchanges and aggregators. This ensures that users can find the best possible prices for their trades.
Overall, BalancerV2-Polygon provides an efficient and flexible trading experience within the Polygon ecosystem. Its integration with the Polygon blockchain offers users faster transactions and lower fees, making it an attractive choice for decentralized trading and portfolio management.
DIA takes a comprehensive approach to fetching trade data from various DeFi and NFT exchanges. The process differs depending on the type of exchange.
For centralized exchanges such as Coinbase, Kraken, and Binance, DIA utilizes scrapers to directly collect trades from the exchange databases. This is done using Rest APIs or WebSocket APIs. The frequency of data collection varies between 1 to 7 seconds, depending on the specific exchange. By retrieving the data as close to the source as possible, DIA ensures high precision and up-to-date information.
In the case of decentralized exchanges (DEXs) like Uniswap, curve.finance, and PancakeSwap, DIA subscribes to swap events in liquidity pools on the respective blockchains. This allows DIA to fetch trading data directly from the blockchain itself, enhancing the accuracy and reliability of the data. By leveraging blockchain oracles, DIA can access verified data from outside the blockchain and supply it to smart contracts.
When it comes to NFT marketplaces, DIA captures live trading data by monitoring the smart contracts of integrated marketplaces. The retrieval period for NFT transactions typically ranges from 20 seconds to 1 minute. This ensures that DIA accurately tracks all NFT transactions happening in real-time without relying on potentially unreliable bids and offers data.
Overall, DIA's approach to fetching trade data involves a combination of scraping from centralized exchange databases, monitoring swap events on decentralized exchanges, and tracking smart contracts on NFT marketplaces. This comprehensive data management strategy enables DIA to provide highly accurate and customizable price feeds for their users.
DIA's process of computing trade data from BalancerV2-Polygon to build price feed oracles differs depending on the type of exchange we are referring to.
For DeFi exchanges, DIA follows a two-step process. First, data cleaning and outlier detection are performed to ensure the resilience of the price estimation process against irregularities. This involves removing trades with prices that deviate significantly from the current market price. Outliers are detected and excluded using an Interquartile Range (IR) filter, which filters out trades falling outside of an acceptable range relative to the interquartile range. Only trades falling into the "middle" quartiles move forward for further processing.
Next, DIA applies price determination methodologies to calculate the final price. One such methodology is the Volume Weighted Average Price (VWAP), which takes into account the different volumes of trades. All trades from the queried time range are collected and weighted by their volume to calculate a single price value.
For NFT exchanges, the process involves two steps. Firstly, the on-chain trade data is processed through cleansing filters to exclude market outliers and manipulation techniques. This ensures that the pricing data is representative of the market. Secondly, a pricing methodology is applied to determine the floor price of the NFT collection. DIA offers various methodologies, including the Floor Price, which provides the lowest sale price of an NFT collection during a given time window.
To combat market manipulation techniques like wash trading and sweeping the floor, DIA applies advanced methodologies such as the Moving Average of Floor Price. This methodology calculates the moving average of a collection's floor price, with customizable parameters to adjust to specific use cases. DIA also employs an interquartile range outlier detection filter to filter out malicious behavior.
In summary, DIA's process of computing trade data from BalancerV2-Polygon to build price feed oracles involves data cleaning, outlier detection, and the application of various pricing methodologies depending on the type of exchange. These processes ensure the accuracy and reliability of the price feed data.
Instead of distributing pre-calculated data feeds, DIA covers the whole data journey from individual trade collection, and computation to the last mile of the feed delivery.