In other Decentralized Exchanges where token accounting is paired with pool logic, multi-hop trading (A->B->C) can become costly since ERC20 tokens must be transferred at each hop. Balancer's advantage here is that all the tokens are stored in the same contract, The Vault. This powerful difference allows for far greater swap efficiency. Instead of transferring tokens on each step of a multi-hop trade, The Vault simply keeps internal records of which pool is holding what, transferring tokens only at the input and output step. This reduction in token transfers ultimately saves a considerable amount of gas.