Cross-chain remained the core focus during the last quarter of 2023. The contributors’ efforts finally came to fruition mid-December, with the launch of cross-chain swaps and transfers between ICON and Archway.
More blockchain connections will follow in the coming months, but the top priority is to stabilise bnUSD with the bnUSD Savings Rate and navigate a potential merger with the ICON Network.
Here’s what the contributors accomplished since the Q4 roadmap update:
- mainnet: Launched cross-chain swap, loan, and token transfer features
- testnet: Implemented the bnUSD Savings Rate
- testnet: Implemented the loan interest model
- testnet: Added support for RWAs and revenue capture (e.g. use the Stability Fund to buy government bonds)
- testnet: Enabled ICS20 token support (e.g. USDC from Noble)
- testnet: Implemented all cross-chain swap, loan, and token transfer features for Havah and EVM chains
- Launched cross-chain swaps on Archway
- Launched cross-chain transfers on Archway
- Added support for various Archway wallets
Quality of life and code improvements
- Set up a branded documentation site and overhauled the content
- Updated balanced.network to reflect the cross-chain upgrade
- Fixed the token balances displayed in the legacy ICON Bridge modal
- Fixed an issue that prevented new proposals from appearing in the app
- Published Balanced: Now connected to Archway
- Conducted a cross-chain pre/post launch campaign on Twitter
- Added a cross-chain marketing card to the Balanced branding kit (zip)
On December 18, Balanced debuted its cross-chain interface on the Archway blockchain. It was a smooth launch, and thanks to the ICON Foundation and Archway Liquidity Council, $100K of liquidity was deposited into the sARCH/bnUSD pool to facilitate trades.
The Archway launch provided a great testing ground for xCall and Balanced, but it’s just the beginning. Balanced plans to support other chains that xCall connects to, so Avalanche and Injective are up next.
Hana Wallet integrates Balanced swaps
The Hana Wallet has matched Balanced’s xCall efforts, with their support for Archway strengthening our cross-chain debut. It’s the best place to use Balanced on mobile: for ICON, Archway, and beyond.
Now, they’ve released an update that adds the Balanced trading experience directly to the Hana wallet:
The swap logic uses Balanced liquidity and transaction routing, and a pass-through contract to handle fees. Some swaps via Hana include a 0.25-0.75% fee, but Balanced benefits from every swap – regardless of where it takes place.
To present the cheapest swap price to users, Hana aims to integrate a range of exchanges. Their next step is to support cross-chain swaps, building on the work Balanced has already done.
To learn more, see Swaps - Hana Wallet.
If you want to integrate Balanced functionality into your own app, reach out in the Development channel on Discord
Coming soon: the bnUSD Savings Rate
As bnUSD continues to trend below $1, the contributors have been working to improve its stability through a strategy called the bnUSD Savings Rate (BSR).
The BSR provides an opportunity to earn yield: invest bnUSD to earn borrower interest, in addition to incentives from Balanced revenue-generating activities. The increased demand for bnUSD will encourage stablecoin deposits via the Stability Fund, which will make it easier for arbitrageurs to keep the price stable.
The smart contract work for BSR is complete, and will be ready to launch on mainnet after Balanced adds support for USDC from Archway.
Borrowers beware: after the BSR proposal is approved, borrowers will pay 2% interest per year. Their debt will increase block by block, and the proceeds distributed to BSR investors.
Cross-chain contract upgrades
A number of contract changes were required to get Balanced working cross-chain, which required 6 separate proposals:
- BIP46: Balanced cross-chain launch step 1
- BIP47: Upgrade the DAO Fund
- BIP47: Upgrade Balanced Router
- BIP47: Upgrade bnUSD to a cross-chain token
- BIP48: Upgrade Rewards contract to support cross chain addresses
- BIP48: Upgrade DEX contract with rate limits
Now that Balanced has made the leap, it will only require a single vote to support new chains. Always keep an eye on the app and Discord to make sure you can participate in votes to support additional chains.
The Stability Fund no longer accepts BUSD or IUSDC
Binance will deprecate BUSD in February, so the DAO voted to prevent new Stability Fund deposits: Set BUSD limit to 0 in Stability Fund and bugfix the Router contract
They did the same for IUSDC a week prior, when Orbit Bridge was hacked. To prevent stolen USDC from being used to mint bnUSD, several contributors initiated an emergency shutdown until the proposal could be passed, which also reactivated Balanced. BIP 49: Lower IUSDC Stability Fund limit to 0 and re-enable Balanced
The Stability Fund doesn’t accept any stablecoins currently, but work is underway to get access to Cosmos-native USDC through the Archway blockchain. Once complete, you’ll be able to transfer USDC to Archway via cctp.money, then to ICON through Balanced.
A proposal to merge with ICON for joint success
In the lead-up to Balanced’s cross-chain debut, it became clear that the success of Balanced and ICON are more intertwined than ever. ICON needs Balanced to demonstrate the power of xCall, and Balanced needs ICON to provide meaningful liquidity to support traders as it expands cross-chain.
This culminated in a proposal to merge Balanced and ICON under a single vision: to make Balanced a leading cross-chain DeFi protocol, with the ICON blockchain as its hub.
The initial proposal included using 50% of Balanced revenue to buy and burn ICX, for the ICON Network to use emissions to provide liquidity, and for the ICON Foundation to fund ongoing development. It also proposed moving to a single-token model (ICX), with all BALN to be purchased at a premium.
Extensive community feedback and additional negotiations concluded with a counter proposal that retains BALN and will see ICON make a strategic investment into the DAO Fund.
What happens now? The Balanced and ICON communities will need to vote on the proposal, which we expect within a few weeks. Rather than a text proposal to assess intentions, the developers are preparing smart contracts to enact the agreement if the proposal passes.
Make sure to read up on the full discussion before it goes to a vote:
Over the last 3 months, Balanced earned $15,964 from fees:
- 2,653 bnUSD from loans
- 15 bnUSD from the Stability Fund
- $13,296 from swaps
$4,789 of that was distributed to bBALN holders, which gives BALN a 30-day trailing APY of 1.8%.
Balanced’s holdings have increased by $39,322 since the last roadmap update.
- DAO Fund: + $11,445
- Protocol-owned liquidity: + $27,116
- Reserve Fund: + $761
13,980,613 BALN (54%) have been locked in 934 wallets. There’s a total of 6,450,529 bBALN, giving an average lock-up time of 1.84 years.
Balanced wallpapers & NFTs
The cover for this roadmap update, Focus, has been added to the collection of Balanced wallpapers.
The animated version has been added to the Balanced NFT collection, which you can view on the Balanced website:
If you’d like a chance to win the Focus NFT, share the roadmap with your followers and tell us what excites you the most about this update.
The winner will be announced in 10 days.
Plans for Q1 2024
During Q1, the contributors plan to:
- Make preparations for the ICON merger
- Add support for Archway-native USDC
- Launch the bnUSD Savings Rate
- Launch cross-chain support for Avalanche on testnet