What is a balanced DAC/amp?

Many high end DAC/amps have balanced outputs. Usually these include dual 3-pin XLR outputs for speakers, a 4-pin XLR for headphones, or many portable headphone amps like the Fiio BTR5 include a 2.5mm TRRS balanced output.

But what does a balanced dac/amp actually do, and do you need one?

What is a balanced signal?

A balanced output in a DAC or amp is one that outputs a balanced signal. To understand what makes a balanced signal different than an unbalanced signal, you have to understand exactly how an unbalanced signal works. In a regular audio or electrical connection, you have a hot/signal and a ground. 

For a stereo system like headphones, this shows up as a TRS (tip, ring, sleeve) connector. If you look at the 3.5mm or 1/4" jack on your headphones, you'll see three metal parts separated by black plastic rings. Two of the sections carry signal (one for left, one for right), and one functions as the ground.

In a powered speaker system (or a connection between a DAC and amp), you may see dual RCA connectors (one for left, one for right). RCA connectors have two parts-- one signal and one ground.

Each of these only has one signal, and one ground per channel. This can be problematic for long cable runs because of interference introduced into the signal, which can come out as noise in the audio.

Balanced systems aim to combat this by introducing another wire. In the case of speakers with dual 3-pin XLR connectors, one for each stereo channel, there's actually two signal and one ground wire. The two signals are opposite phases (if you looked at the wave, it would look inverted), meaning they should be completely identical except flipped. But, if noise is randomly introduced to the balanced signal, then the receiver can use the two signals together to cancel the noise entirely.

Do you need a balanced system?

In most cases, you probably don’t. Balanced systems primarily combat noise over long cable runs, so unless you have a particularly electrically-noisy environment or long cables, you probably will not hear the difference.

But, there is one case where a balanced amp may make more of a difference for headphones. Because of the way most balanced headphone amps are designed, they actually output more power total when running via a balanced output. This means hard-to-drive headphones may be better driven by a balanced amp over a balanced connection, even if you don’t notice the noise difference.